UNIVERSITY    OF    CALIFORNIA 

COLLEGE    OF    AGRICULTURE 

AGRICULTURAL   EXPERIMENT   STATION 

Califon 

n       rwo  CIRCULAR  No.  272 

Reserve 

November,  1923 

CALIFORNIA  FARM  TENANCY  AND 
METHODS  OF  LEASING 

By  R.  L.  ADAMS 


CONTENTS  PAGB 

Introduction 2 

Status  of  farm  tenancy  in  California 3 

Extent  of  tenancy 3 

Many  viewpoints  regarding  tenancy 4 

Economic  advantages  and  objections 5 

Tenancy  of  the  future 6 

Tenancy  well  intrenched 6 

Tenancy  not  a  stepping  stone  to  ownership 7 

Suggested  changes 7 

California  farm  leasing  practices 8 

Methods  of  study 8 

General  observations 8 

Leasing  of  orchards  and  vineyards 10 

Leasing  lands  for  field  crops 14 

Alfalfa 16 

Beans 16 

Corn 17 

Cotton 17 

Grain  and  grain  hay 17 

Hops 19 

Rice.: 19 

Sugar  beets 20 

Leasing  of  dairies 21 

Leasing  lands  for  truck  crop 25 

Leasing  strawberry  lands 26 

Leasing  poultry  plants 26 

Leasing  livestock  ranges  and  ranches 27 

Leasing  methods  of  the  Sacramento  and  San  Joaquin  Deltas 28 

The  Sacramento  delta 29 

The  San  Joaquin  delta 30 

General  provisions  of  delta  leases 31 

General  provisions  common  to  farm  leases 32 

Preparing  the  lease 35 

Legal  requirements 35 

Framework  of  the  lease 35 


2  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT   STATION 

PAGE 

Items  to  be  considered 36 

General  provisions 36 

Special  provisions  for  field  crops  leases 38 

Special  provisions  for  fruit  leases 39 

Special  provisions  for  dairy  leases 40 

Special  provisions  for  leases  of  livestock  ranges 41 

Sample  lease  form 42 

Empirical  method  for  determining  rental  rates 44 

Conclusion 48 

Acknowledgments 48 


INTRODUCTION 

Tenanting  of  farm  lands  is  a  firmly  established  practice  in  Cali- 
fornia agriculture.  Extensive  areas  of  the  state  are  in  possession 
of  owners  who  do  not  care  to  sell  at  prices  they  can  obtain  or  are 
either  unable  or  unwilling  to  attempt  to  personally  operate  their 
holdings.  Owners  so  situated  find  in  tenancy  a  means  of  obtaining 
some  income,  a  relief  from  farm  labor  difficulties,  a  possibility  for 
larger  returns,  and  a  chance  to  move  to  other  localities  to  provide  better 
educational  facilities  for  their  children  or  more  acceptable  living 
conditions  for  themselves. 

Tenancy  relieves  owners  who  are  engaged  primarily  in  other  busi- 
nesses and  who  are  disinclined  to  give  the  time  and  attention  required 
to  direct  farming  operations.  It  provides  a  means  of  utilizing  lands 
while  being  held  for  higher  prices  or  until  the  time  is  opportune 
for  subdividing  and  selling,  or  which  are  being  retained  for  ultimate 
uses  other  than  farming,  such  as  power  sites,  mineral  claims,  or  forest 
plantings.  Tenancy  is  commonly  utilized  in  connection  with  lands 
included  in  estates  pending  final  court  decrees  permitting  distribution, 
and  lands  inherited  by  women  and  children.  Tenancy  provides  a  way 
to  greater  freedom  for  men  who  desire  to  farm  for  themselves  but  who 
do  not  possess  sufficient  capital  to  purchase.  It  is  a  means,  also,  by 
which  beginners  in  agriculture  and  new-comers  to  California  may  test 
their  abilities  prior  to  actual  purchase.  Yet  it  is  possible  that  tenancy 
may  increase  to  such  an  extent  as  to  become  a  social  and  economic 
menace. 

It  is  the  purpose  of  this  publication  to  set  forth:  (1)  something  of 
the  tenant  situation  as  it  affects  the  social  and  economic  welfare  of 
California,  (2)  a  description  of  leasing  methods  in  use  in  various  agri- 
cultural sections  of  the  state,  (3)  a  suggestion  concerning  ways  of 
determining  proper  division  of  income  between  landlord  and  tenant, 
and  (4)  items  to  be  considered  in  drawing  up  leases. 


Circular  272] 


CALIFORNIA   FARM    TENANCY   AND   LEASING 


STATUS  OF  FARM  TENANCY  IN  CALIFORNIA 


EXTENT  OF  TENANCY 


Federal  census  data  covering  the  past  forty  years  show  that  the 
practice  of  renting  agricultural  lands  by  owners  to  others  for  farming 
purposes  is  firmly  intrenched  in  California.  Figures  collected  in  1919 
indicate  that  21.4  per  cent  of  the  117,670  farmers  of  the  state  farm 


Sketch  Map  Showing  Extent  of 
Farm  Tenancy  in  California. 
(Prom  Census  of  1920) . 


Localities  possessing  30%   or 

more  of  tenant  farms 
Localities  possessing  20  to 

J0%   of  tenant  farms 
Localities  possessing  10  to 

20^  of  tenant  farms 
Localities  possessing  less 

than  10#  of  tenant  farms 


nothing  but  rented  lands,  while  9.9  per  cent  lease  lands  in  addition  to 
their  own  holdings.  The  trend  in  numbers  of  tenants  during  this 
period  has  kept  pace  with  the  increase  in  numbers  of  farms.  The 
proportion  of  farmers  operating  rented  lands  only  in  1880  was  19.8 
per  cent;  in  1890,  17.6  per  cent;  in  1900,  23.1  per  cent;  in  1910,  20.6 
per  cent ;  and  in  1920,  21.4  per  cent.    Data  showing  the  proportion  of 


4  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

land  area  operated  under  some  form  of  rental  are  not  available  prior 
to  1900.  For  the  twenty  years  beginning  in  1900  and  ending  with  the 
1920  census,  the  proportion  has  increased  somewhat.  In  1900,  14.3  per 
cent  of  the  land  area  was  in  the  hands  of  tenants;  in  1910  the  figure 
stood  at  22.2  per  cent ;  and  in  1920  at  22.7  per  cent. 

MANY  VIEWPOINTS  KEGAKDING  TENANCY 

The  complexity  of  the  problem  of  tenancy  gives  rise  to  many  view- 
points and  to  various  opinions  as  to  the  effect  which  the  practice  may 
have  upon  the  social  and  economic  welfare  of  the  state.  The  chief 
views  and  opinions  may  be  classified  as  follows  : 

1.  That  leases  give  preferential  privileges  to  members  of  more  or 
less  unassimilable  races. 

2.  That  concentration  of  foreigners  in  limited  areas  is  encouraged 
by  leasing,  creating  a  condition  contrary  to  the  best  interests  of  the 
state. 

3.  That  the  crop  producing  power  of  the  land  is  more  rapidly 
reduced  under  tenancy  because  less  attention  is  paid  to  (a)  proper 
methods  for  maintaining  soil  quality — a  process  which  necessarily 
involves  years  of  effort,  (b)  seed  selection,  (c)  preventing  infestation 
or  subsequent  control  of  weeds,  rodents,  insect,  bacterial,  and  fungous 
pests,  (d)  proper  use  of  irrigation  water,  (e)  the  practice  of  good 
farming  in  general. 

4.  That  farm  investments  depreciate  under  tenancy,  especially 
buildings,  fences,  implements  and  machinery,  since  costs  of  maintain- 
ance  and  improvements  are  of  only  remote  or  temporary  interest  to 
tenants. 

5.  That  the  prevailing  method  of  leasing  farm  lands  is  a  product 
of  earlier  conditions  which  are  now  so  changed  that  a  revision  is  in 
order. 

6.  That  community  progress  is  retarded  where  tenancy  predomin- 
ates, especially  where  team  work  is  required  for  large  reclamation 
plans  or  extensive  improvements. 

7.  That  there  is  a  point  beyond  which  the  bad  features  of  tenancy 
will  more  than  offset  any  advantages.  Just  where  this  point  may  be 
is  still  a  matter  of  conjecture,  but  if  it  is  possible  to  set  such  a  line 
of  demarcation,  its  immediate  determination  is  certainly  vital  and 
desirable. 

It  is  manifestly  impossible  to  discuss .  fully  all  angles  of  farm 
tenancy  in  a  single  experiment  station  publication.  The  outstanding, 
immediate  need  is  for  information  concerning  leasing  practices  now 


Circular  272]  California  farm  tenancy  and  leasing  5 

followed  in  California.  Studies  of  the  extent  and  methods  of  renting 
are  necessary  as  a  preliminary  to  the  forming  of  conclusions  concern- 
ing what  improvement,  if  any,  is  needed  in  the  tenancy  situation  and 
how  such  improvement  can  be  brought  about. 

A  recent  cooperative  study*  of  tenancy  conditions  in  this  state 
deals  at  length  with  the  general  economic  and  social  conditions  sur- 
rounding the  renting  or  leasing  of  California  farm  lands.  The  findings 
show  that,  though  economically  tenancy  has  a  place  in  present-day 
agriculture,  the  feeling  is  general  that  the  future  development  of  Cali- 
fornia agriculture  should,  whenever  possible,  exclude  much  of  tenancy, 
particularly  if  the  tenant  class  is  composed  of  undesirable,  unassimil- 
able  peoples  who  do  not  farm  intelligently  and  are  wasteful  of  Cali- 
fornia 's  agricultural  assets. 


ECONOMIC   ADVANTAGES    AND   OBJECTIONS 

The  more  outstanding  economic  advantages  of  tenancy  are  set 
forth  as  follows : 

1.  Opportunity  to  engage  in  farming  with  limited  capital. 

2.  Part  solution  of  the  problem  of  obtaining  suitable  and  suffi- 
cient farm  laborers. 

3.  Utilization  and  hastened  development  of  lands  otherwise  not 
likely  to  be  farmed,  such  as  ranges  and  hill  lands,  large  estates  awaiting 
subdivision,  and  lands  poorly  situated  as  to  soils,  water  conditions, 
climate,  towns,  and  markets. 

4.  Augmenting  of  land  values  through  tenant  activities. 

5.  Increased  financial  prosperity  to  community  and  to  land  owners. 

The  main  economic  objections  to  tenancy  are: 

1.  Tendency  toward  soil  deterioration. 

2.  Poor  farming  methods. 

3.  Neglect  of  land,  buildings  and  equipment,  partly  traceable  to 
the  failure  to  give  the  tenant  security  in  his  right  to  unexhausted 
improvements,   - 

4.  Sending  earnings  out  of  the  community. 

5.  Postponement  of  the  subdivision  and  sale  of  large  holdings. 

6.  Retardation  of  cooperative  movements. 


*  Land  Tenancy  in  California,  Transactions  of  the  Commonwealth  Club,  San 
Francisco,  November,  1922,  Vol.  XVII,  No.  10.  Results  from  a  cooperative 
study  made  jointly  by  the  Commonwealth  Club  and  the  Division  of  Farm 
Management,  College  of  Agriculture.  Extracts  used  in  this  section  dealing  with 
the  "Status  of  Farm  Tenancv  in  California." 


6  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT   STATION 

The  bulk  of  evidence  is  to  the  effect  that  tenancy  is  a  good  thing 
economically  for  the  locality  where  it  occurs  and  in  its  total  effect 
upon  the  state  as  a  whole,  provided  that  it  is  an  adjunct  to  and  not 
a  substitute  for  ownership. 

Socially,  tenancy  is  bad  in  so  far  as  it  represents  an  influx  of 
undesirable,  unassimilable  peoples,  for  sooner  or  later  such  invasion 
is  reflected  in  a  lowering  of  community  standards  and  ideals,  a  loss  of 
interest  in  community  progress,  and  a  decadence  of  farming  in  the 
locality  so  affected ;  it  is  good  in  so  far  as  it  represents  the  entrance 
into  agriculture  of  worth-while  peoples — worth-while  from  standards 
not  only  of  social  value  but  of  a  permanent  agriculture — who  will 
build  up  the  country  and  furnish  the  brawn  and  brain  so  necessary  to 
American  progress. 

TENANCY  OF  THE  FUTURE 

According  to  the  general  feeling  of  well  informed  men  throughout 
the  state,  there  is  no  outlook  for  either  the  elimination  of  or  a  material 
reduction  in  tenancy  in  the  near  future.  The  concensus  of  opinion 
is  that  in  future  tenancy  should  be  excluded  in  cases  where  it  is  possible 
to  subdivide  and  sell  fairly  to  bona  fide  purchasers.  It  appears 
strongly  that  tenancy,  at  least  for  the  present,  must  be  accepted  as  a 
necessary  institution. 

Whether  the  future  shall  include  or  exclude  tenancy  is  closely 
linked  with  the  question  whether  lands  can  be  divided  and  sold  or 
must  continue  in  the  hands  of  tenants.  Sentiment  or  business  acumen 
may  result  in  the  owner's  wish  to  retain  his  property ;  but  the  feeling 
in  most  communities  is  that  subdivision  and  sale  is  preferable  to 
tenancy  in  that  ownership  by  operator  makes  for  stability  of  interest, 
permanency  of  agriculture,  and  marked  improvement  in  agricultural 
practices. 

TENANCY  WELL  INTRENCHED 

Tenancy  in  California  is  well  intrenched  in  the  growing  of  such 
field  crops  as  grain,  hay,  beans,  potatoes,  rice,  peas,  maize,  sugar  beets, 
cotton,  melons,  cantaloupes,  sweet  potatoes,  flower  and  vegetable  seeds, 
artichokes,  and  asparagus. 

Much  tenancy  occurs  in  the  truck-growing,  market-garden  regions. 
Tenancy  is  usually  the  exception  rather  than  the  rule  in  deciduous 
fruit  growing  and  in  grape  production,  although  berry  growing,  espe- 
cially strawberries,  is  fairly  well  represented  by  tenant  farms.  There 
are  many  rented  dairy  farms,  and  some  renting  of  livestock  ranches. 

Very  little,  in  fact  almost  no  tenancy  occurs  in  the  poultry  industry, 
in  citrus  and  walnut  growing,  and  in  many  fruit  belts. 


CIRCULAR   272]  CALIFORNIA    FARM    TENANCY   AND   LEASING 


TENANCY  NOT  A  STEPPING  STONE  TO  OWNERSHIP 

An  important  outcome  of  the  recent  studies  is  the  finding  that 
tenancy  is  not  a  stepping  stone  to  ownership.  Of  twenty-seven 
counties  studied,  only  six  indicated  conditions  favoring  the  acquisi- 
tion of  farms  by  tenants.  In  twenty-one  counties  the  outlook  was 
negative.  Counties  reporting  tenancy  as  a  general  means  to  ultimate 
ownership  were :  Alameda,  Fresno,  Kings,  Marin,  Sonoma,  and 
Stanislaus. 

There  are,  of  course,  many  individual  tenants  scattered  over  the 
state  who  by  means  of  exceptional  ability  or  favorable  situation  will 
ultimately  become  owners. 

Keasons  why  tenancy  is  not  a  stepping  stone  to  ownership  were  set 
forth  as  follows: 

1.  The  relatively  low  prices  for  agricultural  products. 

2.  High  prices  asked  for  suitable  or  desirable  farm  lands. 

3.  Difficulty  of  borrowing  money  except  upon  tangible  assets,  in 
other  words,  insufficient  command  of  capital  to  make  the  first  pay- 
ments— often  substantially  heavy. 

4.  High  costs  of  production  when  labor  must  be  hired  or  materials 
purchased. 

5.  Operation  of  the  federal  income  tax  which  causes  owners  to 
postpone  selling. 

From  five  to  twelve  years  is  the  time  ordinarily  necessary  before 
the  step  from  tenant  to  owner  can  be  taken,  individual  cases  varying 
within  rather  wide  extremes.  Even  this  length  of  time  does  not  mean 
full  ownership,  since  ownership  is  commonly  considered  as  being  estab- 
lished when  sufficient  accumulation  of  earnings  has  occurred  to  make 
the  initial  payment  possible. 

SUGGESTED  CHANGES 

The  findings  suggest  certain  recommendations  for  improvement  as 
follows : 

1.  Use  of  the  share  rental  method  instead  of  the  cash  basis. 

2.  Insistence  by  owners  upon  better  farming  methods. 

3.  Farm  units  of  a  size  which  will  insure  use  of  the  best  possible 
farming  practice,  including  greater  intensity  and  diversification. 

4.  Guarantee  of  possession  so  that  tenants  may  make  improvements. 

5.  More  binding  and  enforceable  contracts. 

6.  More  interest  by  owners  in  maintaining,  if  possible,  the  crop 
producing  power  of  the  land. 


8  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

7.  Education  of  the  landlord  concerning  the  real  condition  of  his 
tenant. 

8.  Supplying  by  tenant  of  sufficient  working  equipment,  particu- 
larly livestock,  to  insure  his  interest  and  to  increase  his  responsibility. 


CALIFORNIA  FARM  LEASING  PRACTICES 

METHOD  OF  STUDY 

Bringing  together  data  concerning  methods  employed  in  leasing 
California's  agricultural  lands  has  been  accomplished  by  (1)  detailed, 
intensive  studies  made  in  selected  districts;  (2)  collection  of  farm 
leases  in  actual  use,  obtained  from  tenants,  owners,  county  records,  a 
total  of  407  being  secured;  (3)  studies  of  the  more  recent  findings 
concerning  farm  tenancy  as  shown  by  investigations  in  other  states; 
(4)  field  survey  in  twenty-seven  counties,  conducted  by  means  of 
questionnaires,  conferences,  and  discussions  with  local  people  so 
situated  as  to  be  in  touch  with  the  tenancy  situation  in  their  sections. 

GENEEAL  OBSERVATIONS 

In  setting  forth  current  practices  in  leasing  California's  agri- 
cultural lands,  attention  is  confined  to  leases  covering  an  entire  farm 
or  ranch  as  the  unit.  No  attempt  is  made  in  this  presentation  to  dis- 
cuss agreements  or  contracts  covering  some  special  phase  of  the  farm 
business,  or  providing  for  some  specified  activity.  There  are  in  force 
a  great  variety  of  such  agreements,  varying  in  degree  of  complexity 
and  scope  of  work  to  be  performed  or  obligations  to  be  assumed,  such 
as  contracts  providing  for  the  harvesting  of  a  fruit  crop,  supplying 
of  hand  work  for  sugar  beet  fields,  baling  of  hay,  gathering  and 
threshing  of  grain,  cutting  of  wood,  digging  of  drains,  building  of 
farm  structures,  and  marketing  of  products. 

The  renting  and  leasing  of  many  California  farm  lands  follow 
certain  general  rules,  based  on  long  time  custom  or  local  practice.  It 
is  possible  to  set  forth  the  general  terms  governing  different  types  of 
farming,  yet  a  perusal  of  many  individual  leases  and  a  study  of  rent- 
ing practices  in  the  counties  where  tenancy  is  most  common  show 
that  there  are  many  minor  differences  included  in  the  leases  as  drawn 
and  the  practices  as  followed.  At  best,  a  general  survey  is  valuable 
for  its  informative  worth  rather  than  as  a  guide  to  the  drawing  up  of 
a  lease  to  cover  a  specific  property  in  a  way  that  will  best  safeguard  all 
interests. 


CIRCULAR   272]  CALIFORNIA   FARM   TENANCY   AND   LEASING  9 

Leases  are  the  result  of  bargaining  between  prospective  tenants  and 
owners.  They,  therefore,  reflect  the  bargaining  ability  of  the  respec- 
tive parties.  Lack  of  uniformity  in  size,  productive  capacity,  equip- 
ment, location,  and  operating  costs  of  farms  and  ranches,  coupled  with 
the  personal  characteristics  of  landlord  and  of  tenant  require  that 
each  lease  be  largely  treated  as  an  individual  case.  The  terms  of  pay- 
ment for  property  vary  through  wide  extremes  because  of  the  great 
differences  existing  in  soil  types,  topography,  crop  producing  power 
of  lands,  distance  to  market,  and  amount  and  condition  of  improve- 
ments. Terms  cover  not  only  rentals  in  cash  or  crops  but  improvements 
asked  of  the  tenant,  such  as  planting  of  alfalfa,  care  of  orchards,  level- 
ling of  land,  clearing  of  underbrush  and  trees,  putting  in  of  drains, 
and  construction  of  buildings.  Provisions  governing  rights,  require- 
ments, and  reservations  by  both  parties  depend  on  the  type  of  agri- 
culture involved.  Fruit  leases,  for  instance,  define  with  care  the  way 
that  trees  and  vines  shall  be  handled;  rice  leases  specify  removal  of 
weeds;  tomato  leases  call  for  proper  disposal  of  the  vines.  The 
integrity  of  both  parties  is  a  factor  ;n  the  drawing  up  of  leases.  The 
more  valuable  the  investment  the  more  carefully  are  provisions 
included  to  insure  the  upkeep  and  care  of  buildings  or  equipment. 

Even  when  generalizing  concerning  common  practices  a  statement 
of  exceptions  must  often  be  included.  For  instance,  in  the  case  of 
grain  lands  there  are  large  numbers  of  leases  which  give  the  landlord 
one-third  the  crop ;  others  where,  because  of  low  yields  or  high  costs 
of  production,  the  landlord  receives  one-fourth.  Occasionally,  there 
are  instances  where  a  one-sixth  share  goes  to  the  landlord,  while  again 
other  rates  are  agreed  upon  which  give  the  landlord  40  or  45  or  even 
50  per  cent. 

Annual  leases  are  in  the  majority,  leases  for  two,  three  or  more 
years  being  relatively  few  in  number.  The  tendency  appears  to  be  to 
rent  large  holdings  for  long-term  periods,  small  holdings  under  an 
annual  lease. 

Few  farm  leases  are  recorded,  possibly  not  exceeding  one  in 
twenty,  or  5  per  cent. 

Time  of  payment  when  cash  rentals  are  involved  follows  no  very 
definite  rule.  In  localities  where  the  property  has  an  important  resi- 
dential value,  monthly  payments  are  often  insisted  upon.  For  farm 
properties  used  primarily  or  exclusively  for  farming  purposes,  quar- 
terly or  semi-annual  payments  are  the  rule,  with  less  frequently  a 
single  annual  payment.  Cash  rents  are  usually  collectable  in  advance 
of  the  period  that  they  are  to  cover. 


10  UNIVERSITY    OF    CALIFORNIA— EXPERIMENT    STATION 

Provisions  which  do  not  pertain  primarily  to  farming  are  also 
found  in  many  leases.  These  have  been  omitted  whenever  they  occur 
as  being  of  only  passing  interest  and  of  no  particular  agricultural 
significance.  Examples  are  (a)  reservation  of  mineral  rights,  (6) 
right  to  start  operations  to  bore  for  oil,  (c)  retention  of  hunting 
rights,  and  of  (d)  rights  of  way. 

Many  southern  California  leases  carry  special  paragraphs  reserving 
to  the  landlord  all  rights  to  prospect  or  drill  for  oil,  gas,  asphaltum, 
naphtha,  and  all  other  minerals,  reserve  rights  for  pipe  lines,  tele- 
phone and  telegraph  poles  and  lines,  and  space  for  derricks,  machinery 
and  tanks. 

In  sections  where  irrigation  water  is  costly,  particularly  if  the 
landlord  pays  for  it,  limitations  are  carefully  set  forth  concerning  its 
use.  This  is  a  common  provision  in  parts  of  southern  California  when 
water  is  expensive  and  at  a  premium,  and  where  leased  agricultural 
lands  are  combined  with  oil  drilling  operations. 


LEASING  OF  OECETAEDS  AND  VINEYAEDS 

Outright  renting  or  leasing  of  orchards  and  vineyards  is  the  excep- 
tion rather  than  the  rule.  No  county,  even  among  those  containing 
extensive  acreages  of  fruits,  possesses  a  large  proportion  of  leased 
orchards  or  vineyards.  This  statement  is  particularly  applicable  to 
the  large  citrus  belts  of  southern  California,  and  to  the  deciduous 
areas  in  Santa  Clara,  Solano,  Fresno,  Kings,  Tulare,  San  Joaquin,  Sac- 
ramento, Butte,  and  other  counties  recognized  as  containing  important 
centers  of  fruit  production. 

Fruit  properties  when  leased  are  usually  more  closely  supervised 
than  are  leased  lands  farmed  to  livestock,  or  to  grain,  hay  and  other 
field  crops.  In  some  sections  the  orchards  are  operated  under  a  labor 
contract  rather  than  under  a  lease,  the  contract  providing  for  the  sale 
of  the  crop  under  an  agreement  by  which  the  purchaser  is  to  furnish 
all  the  labor  for  pruning,  cultivating,  harvesting,  and  marketing 
at  his  own  expense.  This  method  tends  to  relieve  the  owner  of  labor 
worries,  as  does  the  practice  of  selling  the  fruit  on  the  tree,  the 
buyer  thereafter  taking  over  all  details  of  picking,  preparing,  packing, 
haulire*,  shipping,  and  selling. 

Orchard  and  vineyard  leases  follow  a  fairly  uniform  type,  no 
marked  differences  occurring  as  between  one  kind  of  fruit  and  another. 
Thus,  while  the  wording  of  various  leases  is  very  different,  the  require- 
ments show  a  marked  similarity  whether  the  leased  orchard  be  one 
of  prunes,  peaches,  almonds,  walnuts,  pears,  or  other  deciduous  fruits, 


CIRCULAR   272]  CALIFORNIA    FARM    TENANCY   AND   LEASING  11 

or  a  raisin,  table  or  wine  grape  vineyard.    80  few  citrus  holdings  are 
under  lease  that  these  may  be  ignored. 

In  general,  the  size  of  leased  holdings  rang-es  from  20  to  40  acres, 
with  both  larger  and  smaller  holdings  represented  fairly  extensively. 
Some  local  variation  occurs.  In  Alameda  County,  for  instance,  the 
average  is  reported  as  being  from  40  to  80  acres;  in  Fresno,  Kings, 
San  Luis  Obispo,  and  Stanislaus  counties  the  20  to  40  acre  holding 
apparently  predominates ;  in  Santa  Cruz  County,  the  average  is  placed 
at  20  acres;  in  Sonoma  County  at  from  10  to  30  acres.  When  the 
larger  acreages  are  leased,  a  portion  may  be  land  not  in  orchard  or 
vineyard. 

The  annual  lease  is  overwhelmingly  favored,  such  leases  being  in 
the  great  majority.  Many  contain  renewal  provisions.  Some  two- 
and  three-year  leases  are  occasionally  executed,  and  a  few  in  excess 
of  three  years,  although  such  leases  are  usually  to  corporations  having 
exceptional  financial  backing  and  are  carefully  worded  to  insure  proper 
care  of  the  demised  orchard  and  vineyard. 

From  the  evidence,  it  would  appear  that  the  majority  of  the  longer 
term  leases  are  operated  on  the  cash  basis. 

The  use  of  the  share  basis  in  paying  for  leased  property  is  the  rule, 
although  there  is  some  cash  renting.  Apparently  the  share  method  is 
preferred  by  the  landlord  in  that  he  can  thereby  better  retain  super- 
vision over  the  handling  of  the  property  and  the  disposal  of  its 
product. 

.  Cash  rental  rates,  when  in  force,  are  extremely  variable  as  between 
orchard  and  orchard,  vineyard  and  vineyard,  and  locality  and  locality. 
The  causes  are  the  same  as  in  all  leasing,  e.g.,  producing  capacity  of 
the  property ;  extent,  nature  and  condition  of  the  equipment ;  bargain- 
ing power  of  the  parties  to  the  agreement ;  age  of  the  trees ;  demand  for 
leases ;  and  degree  of  economy  possible  in  conducting  cultural  opera- 
tions and  in  marketing  the  product.  The  range  (in  1922)  varied  from 
$25  to  $200  per  acre  for  bearing  orchards,  with  the  majority  of  cash 
leases  indicating  a  closer  range — $40  to  $75  per  acre.  Vineyard  land 
rental  rates  ranged  from  $50  to  $250  per  acre,  with  a  general  range  of 
from  $100  to  $150.  However,  as  already  stated,  cash  leasing  of  orchards 
and  vineyards  is  far  in  the  minority,  the  fruit  belt  in  the  middle  San 
Joaquin  Valley  having,  perhaps,  more  cash  leases  in  proportion  to 
total  leases  than  is  to  be  found  elsewhere.  Under  the  cash  method, 
the  landlord  supplies  orchard,  buildings,  and  usually  equipment — 
work  stock,  harness,  lug  boxes,  and  drying  trays — while  the  tenant 
meets  all  operating  expenses  of  labor,  fuel,  feed,  and  materials — spray, 
dip,  and  packing.     Usually,  the  tenant  pays  for  the  irrigation  water. 


12  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT    STATION 

although  there  are  exceptions  where  the  landlord  meets  this  charge, 
either  wholly  or  to  the  extent  of  one-half  the  cost.  If  water  stock  has 
to  be  purchased,  the  landlord  usually  attends  to  this  and  personally 
carries  the  cost.  Arrangements  usually  provide  for  payment  of  rent 
in  installments,  the  tri-annual  method  being  popular,  so  timed  that  a 
part  of  the  sum  shall  be  paid  at  the  time  of  taking  over  the  lease,  and 
the  remainder  when  receipts  are  coming  in  from  the  sale  of  fruit. 

The  50-50  basis  of  sharing  gross  receipts  is  so  general  that  it  may 
be  considered  the  rule.  There  are  occasionally  some  variations  but  the 
common  practice  is  to  attempt  an  equalization  of  what  each  party 
furnishes  so  that  the  division  of  receipts  can  be  on  the  50-50  basis, 
that  is,  one-half  to  the  landlord  and  one-half  to  the  tenant.  Excep- 
tions are  found  in  some  of  the  less  productive  sections  when  60,  66%, 
or  65  per  cent  and  in  unusual  cases  70  per  cent,  goes  to  the  tenant; 
and,  conversely  when  the  orchard  or  vineyard  is  especially  desirable, 
the  equipment  particularly  good,  or  the  landlord  meets  some  of  the 
operating  expenses,  his  share  may  be  55,  60,  or  65  per  cent.  Then,  too, 
if  the  landlord  does  not  furnish  the  equipment  commonly  provided, 
the  tenant  may  receive  an  increased  percentage  of  the  gross  receipts. 

The  items  entering  into  the  operation  of  mature  orchards  and  vine- 
yards are  land,  trees  or  vines,  buildings,  improvements,  machinery, 
lug  boxes,  trays,  spray  materials,  dips,  sulfur,  labor,  feed,  water,  pack- 
ing boxes,  wrapping  paper,  fuel  for  house  and  pumping  plant.  These 
are  met  in  various  ways,  the  landlord  of  course  supplying  the  land 
and  trees  or  vines,  piping  and  pumping  plant,  while  the  tenant 
usually  supplies  all  labor,  although  some  of  the  harvesting  costs 
may  occasionally  be  met  by  the  landlord.  The  practice  in  regard  to 
the  equipment  is  more  variable,  although  the  more  common  method  is 
for  the  landlord  to  supply  this.  The  tenant  may  meet  the  cost  of  all 
or  a  part  of  the  spray  material,  feed  and  packing  items,  but  it  is 
unusual  although  occasionally  true  that  the  landlord  pays  for  all  these 
items.  Division  of  expense  when  it  occurs  usually  concerns  such  items 
as  water,  feed,  spray  and  packing  house  costs. 

Under  the  more  common  share  system,  the  landlord  furnishes 
orchard  or  vineyard,  buildings,  improvements,  work  stock,  harness, 
implements,  lug  boxes,  trays,  dipping  apparatus,  and  spraying  machin- 
ery ;  while  the  tenant  provides  the  labor,  feed,  and  materials  such  as 
sprays,  dip,  horse  feed,  paper,  and  nails  and  boxes  for  packing.  Yet, 
as  pointed  out  above,  if  it  is  necessary  for  the  landlord  to  do  so  he 
supplies  a  part  of  the  materials,  and  occasionally  some  of  the  labor. 
For  all  practical  purposes,  operators  under  the  share  method  have  in 
mind  an  agreement  by  which  the  tenant  takes  a  contract  to  furnish 


CIRCULAR   272]  CALIFORNIA    FARM    TENANCY    AND    LEASING  13 

all  the  labor  for  cultivation  and  harvesting,  for  which  he  receives  one- 
half  the  gross  returns.  If  the  tenant  provides  some  equipment,  he  is 
reimbursed  accordingly,  the  landlord  being  likewise  reimbursed  for 
any  part  of  the  operating  costs  which  he  may  meet.  Some  vineyard 
leases,  for  example,  provide  that  50  per  cent  of  the  receipts  from 
the  first  crop  and  60  per  cent  from  the  second  crop  of  grapes  shall  go 
to  the  tenant.  Another  form  of  lease  gives  the  landlord  55  to  60  per 
cent  of  the  receipts  when  he  furnishes  all  equipment,  tools,  water,  and 
pays  for  the  spray  materials.  In  one  locality,  if  the  landlord  furnishes 
only  land  and  trees  he  receives  one-third  for  his  share,  but  if  he  also 
supplies  buildings,  equipment  such  as  work  stock,  implements,  tools, 
trays  and  lug  boxes,  pays  for  one-half  of  the  spray  materials,  and 
possibly  for  one-half  the  cost  of  the  irrigating  water  and  the  feed,  he 
then  receives  50  per  cent  and  sometimes  as  much  as  60  per  cent.  The 
higher  rates  hold  in  leases  of  especially  desirable  orchards  and  vine- 
yards. Some  leases  vary  the  percentage  which  the  landlord  is  to  obtain, 
depending  upon  the  method  of  harvesting.  In  a  lease  of  this  type,  if 
the  fruit  is  dried  the  landlord  receives  50  per  cent,  but  if  sold  green 
the  landlord  is  entitled  to  60  per  cent  of  the  receipts.  In  other 
instances,  the  tenant  receives  60  per  cent  if  he  has  to  go  to  the  trouble 
and  expense  of  drying  the  fruit.  In  some  cases  the  landlord  pays  one- 
half  the  labor  cost  of  harvesting  prunes.  One  type  of  lease  provides 
that  the  landlord  shall  pay  one-half  the  harvest  cost  of  drying  apricots 
but  more  of  the  cost  of  harvesting  and  drying  prunes.  In  Santa  Clara 
County,  the  general  plan  provides  for  a  50-50  basis  if  the  landlord 
supplies  land,  trees,  buildings,  equipment,  and  sometimes  spray  mate- 
rials, but  if  in  addition  he  furnishes  horses  and  feed,  he  receives  66% 
per  cent. 

Instances  of  variation  in  lease  provisions  are  common.  In  San 
Luis  Obispo  a  five-year  lease  on  a  50-50  basis  provides  that  the  land- 
lord shall  pay  one-half  the  cost  of  harvest  and  one-half  the  cost  of 
paper,  packing  boxes,  and  nails  during  the  first  year  of  the  lease,  and 
one-half  the  cost  of  packing  materials  and  hauling  only,  during  the 
final  four  years,  A  Solano  County  type  of  lease  gives  the  landlord 
45  per  cent,  he  to  furnish  livestock  and  one-half  the  boxes  and  nails 
for  the  shipping  packages,  A  Sutter  County  lease  provides  for  the 
50-50  division  if  the  tenant  supplies  all  labor  and  materials.  A  Contra 
Costa  County  lease  is  on  the  50-50  basis  but  the  landlord  agrees  to 
do  a  total  of  not  to  exceed  $100  worth  of  cultivation,  to  furnish  equip- 
ment, and  to  pay  one-half  the  cost  of  sprays,  dip  and  sulfur.  A 
Fresno  County  lease,  also  on  the  50-50  basis,  provides  that  the  tenant 
shall  supply  a  spraying  machine  and  two  horses ;  another  lease  in  the 


14  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

same  county,  on  the  50-50  basis,  provides  that  the  landlord  shall 
furnish  all  equipment ;  while  still  a  third  on  the  50-50  basis  provides 
that  the  landlord  shall  supply  the  equipment  and  pay  for  half  the 
water.  A  fourth  lease,  likewise  in  Fresno  County,  sets  forth  that  the 
landlord  is  to  pay  for  feed,  sulfur  and  twine,  as  well  as  to  furnish  all 
equipment,  but  his  share  is  thereby  increased  to  55  per  cent.  Some 
leases  provide  that  the  landlord  shall  meet  part  of  the  cost  of  fuel,  as, 
for  example,  "$10"  in  one  lease,  "100  barrels  of  distillate"  in  a 
second,  ' '  one-half  the  fuel  cost  "in  a  third,  and  ' '  water  up  to  $600 ' ' 
in  a  fourth.  These  instances  indicate  the  wide  variation  in  terms  and 
the  bargaining-  involved  in  working  out  a  mutually  satisfactory  lease. 

When  commercial  fertilizers  are  to  be  used,  the  landlord  usually 
supplies  the  material  and  the  tenant  the  labor  of  applying. 

In  some  of  the  foothill  orchard  sections,  the  leases  state  the  amount 
of  water  that  the  tenant  must  purchase  and  use,  the  monthly  water 
bill  receipts  being  turned  over  to  the  landlord  as  evidence  that  the 
tenant  has  fulfilled  this  obligation. 

When  new  lug  boxes  and  trays  are  needed  the  common  practice  is 
for  the  landlord  to  furnish  the  material  and  the  tenant  the  labor  of 
putting  them  together. 

In  setting  new  orchards,  it  is  customary  for  the  landlord  to  furnish 
trees  and  blasting  powder,  to  pay  for  clearing  land,  and  to  furnish 
stakes,  twine,  and  wire.  Interplanting  of  young  orchards  is  usually 
permitted,  the  tenant  receiving  all  that  he  produces  as  repayment 
for  taking  care  of  the  young  trees  or  vines.  When  intercropping  is 
permitted,  the  landlord  usually  designates  the  kinds  of  crops  which 
may  be  raised,  the  number  per  season,  and  the  permissible  nearness  of 
planting  to  the  trees  and  vines.  Intercrops  are  ordinarily  chosen  which 
in  their  cultural  requirements  or  manner  of  growth  are  least  likely  to 
damage  the  young  orchard  or  vineyard. 

Occasionally  the  tenant  is  called  upon  to  furnish  fruit  trees  or  vines 
and  to  replant  losses  due  to  any  cause  whatsoever,  but  such  conditions 
constitute  an  exception  rather  than  a  rule. 


LEASING  LANDS  FOR  FIELD  CROPS 

Crops  discussed  under  this  heading  are  grain,  including  barley, 
wheat,  oats,  and  grain  hay,  alfalfa,  beans,  sugar  beets,  corn,  rice,  cotton 
and  hops. 

In  this  group  are  a  goodly  number  of  leases  under  various  cash 
rates  with  no  crops  specified,  although  the  agriculture  in  the  com- 
munity is  known  to  be  largely  field  crops, 


Circular  272]  California  farm  tenancy  and  leasing  15 

Many  cash  leases  made  for  field  crops  cannot  be  analyzed  from  the 
contents  of  the  contracts,  since  the  individual  conditions  entering  into 
the  bargaining  are  not  indicated. 

Some  leases  do  not  differentiate  between  different  crops.  Thus,  a 
Ventura  County  lease  jjrovides  for  one-third  share  to  the  landlord  for 
any  oats,  barley,  beans,  beets,  corn  or  baled  hay  produced  on  the 
premises.  A  Yolo  County  cash  lease  at  rates  of  about  $26  per  acre  the 
first  year,  and  $29  per  acre  annually  the  second  and  third  years,  per- 
mits the  growing  of  tobacco,  truck,  or  seed  crops.  A  Merced  County 
lease  claims  one-fourth  as  the  landlord's  share  of  any  crops  of  corn, 
barley,  oats,  or  alfalfa  grown  on  irrigated  land  under  a  five-year  lease, 
with  one-third  of  the  land  to  be  in  crops  annually.  A  three-year 
Stanislaus  County  lease  provides  for  one-third  of  all  grain  crops,  one- 
fourth  of  all  cultivated  crops,  and  60  per  cent  of  rent  of  stubble,  to 
landlord.  A  two-year  Santa  Clara  County  lease  of  land  for  tomatoes, 
sugar  beets,  grain,  seeds,  or  similar  crops  is  placed  at  a  cash  rental  of 
about  $21  per  acre  per  year. 

The  size  of  holdings  in  the  field  crops  group  is  extremely  variable, 
so  much  so  that  an  average  figure  is  of  no  significance. 

The  length  of  lease  is  usually  for  one  year,  although  two-year,  three- 
year,  and  sometimes  longer  leases  are  to  be  found. 

Interesting  provisions  are  to  be  found  in  occasional  leases.  In  one 
lease,  the  tenant  is  enjoined  from  renting  a  threshing  machine  which 
may  have  been  previously  used  on  land  infested  with  morning  glory. 
Another  clause  cautions  the  tenant  to  preserve  all  survey  posts  and 
monuments  of  lines  and  corners,  requiring  him  to  pay  a  surveyor 
selected  by  the  landlord  to  re-locate  and  reset  these  if  removed  by 
reason  of  the  tenant 's  fault  or  neglect.  In  Imperial  County  the  owner 
as  a  rule  pays  the  water  assessments,  the  tenant  paying  for  the  cost 
of  water  used.  Occasionally,  if  hay  or  grain  is  on  hand  when  the 
property  is  taken  over,  the  lease  provides  for  its  replacement  in  equal 
quantity  and  quality  at  the  termination  of  the  lease.  Specific  instruc- 
tions regarding  the  keeping  down  of  weeds,  as  the  pulling  and  burning 
of  radish,  or  the  pulling  of  mustard,  are  often  included. 

Some  leases  require  the  spreading  of  all  manure,  the  area  to  be 
treated  being  occasionally  specified.  In  connection  with  terms  of  pay- 
ment, a  Santa  Cruz  bean  lease  provides  for  a  $25  cash  rent  unless  the 
net  profits  amounts  to  more  than  $75;  in  that  event,  the  landlord 
receives  in  addition  one-third  of  the  net  profits  over  the  $75  limit. 
A  three-year  sugar  beet  lease  is  designed  to  provide  payment  to  the 
landlord  of  one-fourth  of  the  beets  grown,  but  the  minimum  rent  to 
be  paid  per  acre  shall  be  not  less  than  $15  the  first  year  and  $20, 


16  UNIVERSITY    OF    CALIFORNIA EXPERIMENT   STATION 

annually,  the  second  and  third  years.  A  Yuba  County  rice  lease  gives 
the  landlord  option  to  one-fourth  the  crop  or  $15  per  acre  on  all  lands 
planted  to  rice.  Many  Butte  County  rice  leases  combine  the  share 
and  cash  rentals,  as,  for  example,  one-third  the  crop  and  a  cash  rent 
in  addition  of  $5,  $10,  or  $15. 

Alfalfa. — The  range  in  acreage  is  extremely  variable,  being  from 
30  acres  or  less  to  100  acres  or  more.  Long  term  leases  are  general, 
five-  and  ten-year  contracts  being  rather  common,  although  there  are 
many  one-,  two-,  and  three-year  leases.  Since  alfalfa  is  commonly 
leased  in  connection  with  livestock,  the  longer  term  makes  possible 
profitable  use  of  the  crop  in  connection  with  dairy  cows,  hogs,  beef, 
sheep  and  horses. 

In  general,  while  share  leases  are  to  be  found,  cash  leasing  of  alfalfa 
appears  to  be  favored,  rental  rates  ranging  from  $8  to  $50,  depending 
upon  the  acreage,  local  demand,  use,  condition,  yields,  cost  of  water, 
cost  of  labor,  available  markets,  and  character  of  buildings,  ditches  and 
other  improvements.  Generally,  rents  range  higher  in  southern  Cali- 
fornia and  the  San  Francisco  Bay  region,  lower  in  remote  mountainous 
sections,  and  about  intermediate  in  the  Sacramento  and  San  Joaquin 
valleys.  Prices  average,  with  of  course  exceptions  either  way,  from 
$25  to  $40  per  acre  per  year  for  the  higher,  $18  to  $25  for  the  inter- 
mediate, and  $12  to  $20  for  the  lower  ranges. 

The  share  rent  usually  runs  one-fourth  to  one-third  to  landlord 
if  he  furnishes  land,  buildings,  pumping  plant,  or  sometimes  water,  or 
a  portion  of  the  electricity  or  fuel,  while  the  amount  to  the  landlord 
is  increased  to  one-half  if  he  also  supplies  work  stock,  implements, 
and  occasionally  one-half  the  feed. 

Beans. — The  average  bean  acreage  under  lease  apparently  runs 
from  40  acres  or  less  to  160  acres  or  more. 

The  length  of  lease  is  generally  for  a  single  year,  although  leases 
of  two,  three,  four  and  five  years  are  to  be  found. 

The  cash  lease  is  the  exception  rather  than  the  rule.  Rates  mostly 
vary  from  $10  to  $25  per  acre  per  year  for  the  poorer  lands,  and  from 
$30  to  $40  for  the  best  lands. 

The  share  leases,  these  being  in  the  majority,  usually  divide  the 
product  one-fourth  or  one-third  to  the  landlord  when  the  landlord 
supplies  land  and  buildings.  If  the  landlord  also  supplies  work  stock, 
implements,  seed,  all  or  part  of  the  irrigation  water  (when  used),  and 
possibly  one-half  of  the  threshing  expense  and  sacks,  his  share  then 
becomes  one-half.    Occasionally,  the  basis  is  40  per  cent  to  the  landlord. 

When  straw  is  of  value  as  feed,  the  landlord  reserves  either  all  or 
his  pro  rata;  if  it  finds  a  ready  sale,  a  pro  rata  proportion  similar  to 
the  sharing  of  threshed  beans  is  maintained. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND   LEASING  17 

Corn. — The  term  "corn"  in  leases  is  used  both  for  Indian  corn 
and  for  non-saccharine  grain  sorghums.  The  locality  determines  which 
is  involved  in  any  given  lease. 

Cash  leases  for  corn  land  follow  the  rates  set  forth  in  the  intro- 
ductory paragraphs  under  "Field  Crops."  Share  rents  range  from 
25  to  33 %  per  cent  to  the  landlord,  with  33%  per  cent  more  common 
on  the  better  yielding  lands  or  when  operating  costs  are  low,  the  25 
per  cent  holding  when  the  reverse  is  true. 

The  terms  are  quite  similar  to  those  appearing  in  grain  leases  and 
for  most  localities  little  difference  occurs  between  grain  and  corn  leases. 
A  possible  exception  is  an  occasional  clause  which  sets  forth  that  the 
tenant  is  to  clear  the  land  of  corn  stalks  prior  to  the  termination  of 
his  lease. 

Cotton. — Standardization  of  cotton  leases  has  not  as  yet  progressed 
very  far  because  of  the  newness  of  commercial  cotton  production  in  this 
state.  Outside  of  the  Imperial  Valley,  not  enough  acreage  has  yet 
been  planted  under  tenant  conditions  to  test  out  various  contracts. 

In  the  Imperial  Valley  cotton  land  is  leased  for  cash  or  share. 
Cash  rents  are  similar  to  those  applying  to  field  crops  in  general  and 
range  around  $20  to  $35.  Share  rents  are  commonly  one-fourth,  one- 
third,  or  one-half  of  the  cotton  and  seed  delivered  at  the  gin,  the  lower 
rates  prevailing  for  poorer  land  and  when  the  landlord  furnishes  land, 
buildings,  and  sometimes  water.  The  higher  rates  prevail  when  the 
landlord  also  supplies  seed,  stock,  implements,  and  water.  Occasionally, 
the  landlord  pays  a  part  (commonly  in  accordance  with  his  share  of 
the  crop)  of  the  ginning  expense. 

The  annual  lease  is  the  rule.  The  size  of  holdings  is  extremely 
variable,  from  forty  acres  or  less  to  several  hundred  acres,  the  former 
applying  to  family-sized  holdings,  the  latter  to  acreages  handled  by 
groups  of  farmers  working  in  companies. 

Grain  and  Grain  Hay. — Grain  and  grain-hay  leases  providing  for 
the  raising  of  barley,  wheat  and  oats  are  comparatively  simple. 
Provisions  are  neither  numerous  nor  exhaustive. 

The  size  of  holdings  utilized  for  grain  are  rather  large,  ordinarily 
80  to  320  acres  if  irrigated,  or  160  to  1280  acres  if  dry  farmed,  with 
both  larger  and  smaller  farms  quite  common  in  both  groups.  Lands 
used  solely'  for  grain  are  often  handled  under  dry  farming  methods, 
although  there  is  a  good  deal  of  grain  produced  from  leased  irrigated 
lands.  Grain-hay  clauses  are  usually  inserted  to  cover  the  substituting 
of  hay  for  grain  during  seasons  unfavorable  for  grain  filling,  to  take 
care  of  growing  grain  cut  for  harvester  lanes  and  headlands,  or  for 
lands  not  easily  handled  for  grain  harvesting. 


18  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

The  length  of  lease  is  usually  a  single  year,  being  frequently 
renewed  from  year  to  year,  although  grain  leases  of  from  three  to  five 
years  are  in  force.  Frequently,  no  written  contract  is  used,  verbal 
agreements  serving  instead. 

The  share  rent  appears  to  be  more  common  than  cash  renting,  the 
great  majority  of  share  leases  providing  that  the  landlord  shall  receive 
one-fourth  of  the  crop,  or,  in  the  case  of  excellent  producing  lands,  one- 
third,  or  for  poor  producing  lands  one-fifth  and  even  occasionally  as 
low  as  one-sixth.  A  40  per  cent  share  to  the  landlord  is  sometimes 
agreed  upon. 

The  landlord  ordinarily  furnishes  land  and  buildings  on  the  one- 
fourth  or  one-third  basis;  on  the  one-half  basis  he  supplies  seed,  all  or 
in  part,  some  or  all  the  work  stock  and  implements,  sometimes  one-half 
the  sacks,  and  occasionally  will  pay  one-fourth,  one-half,  or  two-thirds 
of  the  threshing  or  baling  expense.  Squirrel  poison,  if  specified,  is 
furnished  sometimes  by  tenant,  sometimes  by  landlord,  and  sometimes 
half  by  each. 

The  general  tendency  is  to  work  out  an  arrangement  under  which 
the  landlord  supplies  work  stock,  implements,  seed,  sacks,  or  shares 
in  the  harvest  expense,  so  that  the  one-third,  one-fourth  or  one-fifth 
share  will  prevail,  with  one-fourth  the  favorite  division  for  dry-land 
farms  and  one-third  for  lands  supplied  naturally  or  artificially  with 
ample  moisture. 

Cash  rents  depend  on  whether  the  land  can  be  irrigated  or  not, 
the  productive  capacity  of  the  land,  the  quality  of  the  grain  produced, 
and  location  with  reference  to  shipping  points  and  markets.  Cash 
rents  range  mostly  from  $1  to  $2  per  acre  for  dry-land  farms,  and 
mostly  from  $2  to  $15  for  irrigated  lands,  with  a  mode  of  $4  to  $7.50. 

Cash  rents  are  payable  in  advance,  annually,  semi-annually,  or 
quarterly,  according  to  local  custom  and  prearranged  agreement. 

Share  rents  are  payable  immediately  following  harvest. 

The  stubble  is  frequently  reserved  by  the  landlord,  particularly  if 
he  is  running  livestock  of  his  own.  Less  frequently  the  stubble  is 
shared,  in  accordance  with  the  division  of  crops,  and  in  exceptional 
instances  is  given  to  the  tenant.  Straw,  if  of  value,  is  shared  in 
the  same  proportion  as  the  grain,  or  may,  in  some  cases,  be  reserved 
by  the  landlord.    Infrequently,  the  straw  is  given  to  the  tenant. 

In  almost  all  leases  the  tenant  agrees  to  deliver  the  landlord  \s  share, 
properly  determined  as  to  amount  and  quality,  to  some  designated 
point,  in  new,  merchantable  sacks. 

Various  provisions,  sometimes  pertinent  only  to  a  single  lease,  are 
occasionally  inserted.    Selection  of  the  sack  sewer  by  the  landlord  is  a 


CIRCULAR   272J  CALIFORNIA    FARM    TENANCY   AND    LEASING  19 

safeguarding  measure  sometimes  resorted  to.  Depths  of  plowing,  use 
of  drill  in  seeding,  no  disc  plows  to  be  used  (commonly  inserted  in 
leases  of  Orange,  Riverside,  and  San  Diego  counties),  and  insurance  to 
be  carried  by  tenant  are  samples  of  such  provisions.  In  irrigated 
districts,  the  landlord  almost  invariably  pays  the  assessments,  with  the 
tenant  paying  for  actual  w7ater  used.  In  other  instances,  the  landlord 
agrees  to  furnish  the  necessary  irrigating  wrater. 

Some  summer  fallowing  is  occasionally  specified,  especially  if  the 
land  is  inclined  to  be  weedy  or  if  the  locality  has  a  deficient  rainfall. 

Hops. — The  number  of  leases  of  hop  fields  is  small.  Acreages  of 
leased  hop  lands  range  mostly  from  fifteen  to  forty  acres,  the  lease 
being  made  out  for  from  two  to  five  years,  with  a  tendency  toward  the 
longer  period  and  the  inclusion  of  a  clause  providing  privileges  for 
renewing. 

Under  the  share  rent  method,  the  landlord  receives  one-fourth  the 
crop  in  the  bale,  he  supplying  land,  established  hop  plants,  pumping 
plant,  kiln,  drier,  storeroom,  drying  shed,  poles  and  wrires,  the  tenant 
furnishing  labor,  string,  water,  work  stock,  implements,  feed  and  fuel. 

Cash  rents  vary  from  $10  to  $30  per  acre  per  year  for  leases 
running  for  five  to  ten  years,  the  landlord  furnishing  items  as  in  share 
renting. 

Rice. — Leased  rice  lands  vary  from  40  to  320  acres,  with  occasion- 
ally acreages  under  lease  above  320  acres. 

At  present,  share  leasing  predominates,  cash  leases  of  former  years 
giving  way  to  share  leases  in  the  belief  that  share  leasing  is  more 
equitable  and  rentals  easier  to  collect. 

Share  leases  mostly  provide  for  one-fourth  or  one-third  to  the  land- 
lord, with  one-third  perhaps  more  common.  Sometimes,  40  per  cent 
is  set  as  the  landlord's  share.  Cash  leases  range  from  $7.50  to  $15 
per  acre  per  year  for  poorer  types  of  land,  and  from  $25  to  $30  for 
more  desirable  lands. 

Since  rice  lands  are  expensive  to  prepare  and  productivity  under 
present  cultural  practices  tends  to  decrease,  graduated  schedules  are 
sometimes  followed,  as  $25  cash  rent  per  acre  for  the  first  year,  $35  for 
the  second,  and  $15  for  the  third  season,  or  $30  annually  per  acre  for 
the  first  and  second  years,  and  $35  for  the  third  and  fourth  years. 

The  tenant  usually  puts  in  the  contours  and  builds  the  field  ditches 
for  irrigation.  Material  for  ditch  boxes  is  usually  furnished  by  the 
landlord,  the  tenant  doing  the  carpenter  work  and  placing  in  the  ditch 
banks.  The  stubble  and  straw  are  usually  reserved  in  the  same  pro- 
portions as  the  threshed  grain  or  else  are  retained  by  the  landlord. 


20  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

Leases  are  made  for  one,  two,  and  three  years,  the  landlord  com- 
monly supplying  only  land,  building's  and  possibly  a  part  of  the  water. 
The  tenant  commonly  supplies  work  stock,  implements,  seed,  labor,  and 
sacks.  Occasionally,  the  landlord  agrees  to  pay  part  of  the  harvesting 
expenses  (e.g.,  one-half). 

Since  a  large  amount  of  water  is  required  in  the  raising  of  rice, 
this  becomes  an  important  item.  It  is  met  in  various  ways.  In  some 
leases,  the  tenant  pays  for  all  the  water ;  in  others,  the  landlord  shares 
this  charge,  for  example,  meeting  the  cost  above  a  stated  amount,  as 
$4,  $7,  or  $10  per  acre,  or  paying  one-third  or  one-tenth  the  power  bill. 

Disclaimers  of  damage  by  landlord  in  the  event  of  non-delivery  of 
water  when  supplied  from  a  community  ditch  is  a  common  clause. 

When  the  landlord  has  an  interest  in  the  crop,  that  is  when  pay- 
ment is  on  the  share  basis,  the  tenant  is  more  likely  to  be  required  to 
keep  up  ditches,  pull  water  grass,  protect  from  birds,  and  follow 
specified  cultural  directions,  including  planting  of  clean  seed. 

Sugar  Beets. — Sugar  beets  are  grown  almost  invariably  under  a 
prearranged  contract  of  sale  to  some  sugar  beet  mill.  Marketing 
responsibility  is  thus  reduced  to  a  minimum. 

Size  of  holdings  leased  for  sugar  beets  range,  as  a  rule,  from  forty 
to  several  hundred  acres,  the  former  figure  prevailing  for  the  family 
unit,  the  latter  for  leases  to  sugar  beet  companies  or  other  corporations. 

Lease  periods  to  corporations  are  commonly  for  ten  or  fifteen  years, 
while  annual  leases  are  the  rule  for  the  smaller  holdings,  though  there 
are  leases  of  two  to  five  years  in  fairly  frequent  use. 

Cash  rents  range  from  $10  to  $20  for  the  larger  holdings,  and  from 
$10  to  $40  for  the  smaller  holdings,  the  rate  depending  on  the  quality 
of  the  land  leased  and  the  nature  of  the  improvements,  payable 
annually  or  semi-annually  in  advance,  or  else  at  time  of  harvest. 

Cash  rents  for  sugar  beet  lands  are  partly  determined  by  the 
possible  use  of  such  lands  for  other  crops,  as  beans,  grain,  corn,  and 
seed. 

Share  rents  usually  allot  to  the  landlord  one-fourth  or  one-third 
of  the  crop  with  sometimes  one-fifth  on  poorer  lands,  and  occasionally 
two-fifths  on  the  best  lands  if  the  landlord  furnishes  land,  buildings, 
and  usually  irrigation  water,  with  the  tenant  supplying  work  stock, 
implements,  other  equipment,  seed  and  labor.  If  the  landlord  supplies 
work  stock,  implements  and  equipment,  he  usually  receives  one-half  the 
crop.  The  tenant  in  all  cases  delivers  the  landlord's  share  to  a 
designated  receiving  station. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND   LEASING  21 

Two  items  commonly  appearing  in  sugar  beet  leases  are  (1)  pro- 
vision for  rotating  crops  in  the  event  of  leases  made  for  periods  longer 
than  three  years,  (2)  retention  by  landlord  of  beet  tops  or  reimburse- 
ment of  tenant  for  these  at  a  nominal  rate.  In  nearly  all  cases,  beet 
tops  must  either  be  fed  on  the  land  or  plowed  under. 


LEASING  OF  DAIRIES 

Leasing  of  dairies  or  of  land  for  dairying  purposes  is  widespread, 
being  especially  common  in  the  counties  of  Alameda,  Contra  Costa, 
Fresno,  Humboldt,  Imperial,  Kings,  Marin,  Merced,  Monterey,  San 
Joaquin,  San  Luis  Obispo,  San  Mateo,  Santa  Cruz,  Sonoma,  and 
Stanislaus. 

The  size  of  the  dairies  under  lease  is  variable,  this  study  disclosing 
a  range  of  from  30  to  150  cows,  with  most  dairies  possessing  from  about 
30  to  90  cows. 

Rental  rates  are  variable,  both  the  cash  and  share  methods  being 
followed.  In  certain  localities,  a  stated  cash  sum  is  agreed  upon  to  be 
paid  monthly,  quarterly,  semi-annually,  or  annually  in  advance.  In 
other  sections,  the  share  basis  is  favored,  the  rate  paid  varying  in 
accordance  with  what  the  landlord  furnishes.  A  third  method  ignores 
the  dairy  as  such,  rental  rates  being  determined  upon  the  crops  pro- 
duced, the  tenant  having  the  right  to  feed  his  share  to  dairy  cattle 
as  he  may  elect. 

Cash  rates  are  fixed  as  a  lump  sum  for  the  entire  plant — land, 
buildings,  fences,  water  supply,  and  so  on,  or  at  so  much  per  acre. 
Specific  rates  can  at  best  be  only  illustrative.  In  Alameda  County  in 
1922,  dairy  alfalfa  land  rented  at  from  $10  to  $30  per  acre,  the  higher 
rate  holding  if  the  landlord  supplies  some,  usually  one-half,  of  the 
cows,  the  lower  rate  if  the  tenant  furnished  all  the  cows.  In  Humboldt 
County,  the  rate  ran  from  $15  to  $25  per  acre,  with  the  higher  figure 
the  more  common.  Here  the  landlord  furnishes  only  land,  buildings, 
and  improvements,  the  tenant  everything  else — cows,  work  stock, 
implements,  and  dairy  utensils.  Most  of  these  rents  are  payable 
monthly,  or  else  every  three  or  six  months,  invariably  in  advance.  In 
Kings  County,  cash  rents  ranged  from  $6  to  $20  an  acre,  depending 
upon  the  character  of  the  leased  lands.  In  Marin  and  Sonoma  counties, 
where  dairying  is  largely  confined  to  rolling,  natural  grass  pastures, 
the  rent  was  from  $2  to  $4  an  acre,  payable  quarterly  or  semi-annually 
in  advance.  In  Merced  County,  rental  for  dairies  on  alfalfa  land 
varied  from  $20  to  $25  an  acre,  the  landlord  paying  for  the  ditch 
water.      Semi-annual   or   annual   payments   are   here   the   rule.      In 


22  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

Monterey  County  the  rate  for  alfalfa  lands  ran  from  $20  to  $35,  with  a 
provision  common  in  one  type  of  lease  that  the  tenant  pay  county  and 
state  taxes,  amounting  to  about  $4  more.  Rents  in  this  county  are 
usually  payable  monthly,  semi-annually,  or  annually.  In  San  Joaquin 
County  rents  of  alfalfa  land  were  from  $20  to  $35,  the  higher  figure 
if  the  landlord  supplied  one-half  the  cows.  In  San  Luis  Obispo  County 
the  pasturage  is  largely  natural  grass  rolling  hills.  Coast  lands  used 
for  dairying  rented  for  from  $3  to  $6  an  acre ;  lands  in  the  interior  for 
from  $1.50  to  $4  an  acre.  In  San  Mateo  County  the  range  is  also 
natural  grass  and  the  rates  ran  from  $2.50  to  $12,  with  a  common 
figure  of  $3  to  $3.50,  payable  semi-annually.  Stanislaus  County  rates, 
based  on  alfalfa  land,  ran  from  $25  to  $35,  with  summer  pasture  along 
the  rivers  set  at  from  50  cents  to  $2  an  acre.  Cash  rates  tend  to 
fluctuate  with  the  financial  situation,  so  that  leases  made  when  high 
prices  are  being  paid  for  milk  and  butter-fat  command  larger  rental 
rates  than  can  be  obtained  during  periods  of  financial  depression. 
If  the  tenant  is  to  plant  alfalfa  or  do  unusual  labor  for  the  landlord, 
he  is  given  a  reduced  rate  or  else  paid  directly  by  the  landlord. 

Two  instances  were  noted  where  cows  were  rented  for  cash.  In 
San  Luis  Obispo  County,  an  annual  charge  of  from  $5  to  $7  cash 
per  cow  was  reported  in  addition  to  the  land  rent.  In  Marin  County, 
an  extensive  dairying  section  involving  1000  cows  operates  on  a  total 
cash  payment  by  the  tenant  of  $20  per  cow  per  year,  payable  quarterly. 
In  addition,  the  tenant  raises  heifer  calves  to  the  extent  of  15  per  cent 
of  the  number  of  cows  in  his  herd,  and  an  extra  heifer  for  every  cow 
that  dies,  all  other  calves  being  vealed  at  six  weeks  of  age.  The  tenant 
furnishes  work  stock,  implements,  machinery  and  equipment.  Hogs 
belong  to  the  tenant.    The  landlord  furnishes  pure-bred  bulls. 

Share  rent  follows  a  rather  definite  plan,  varying  according  to  the 
number  of  cows  and  equipment  furnished  by  the  landlord.  In  general, 
if  the  landlord  furnishes  land,  buildings,  and  improvements  only,  he 
shares  to  the  extent  of  from  33%  to  40  per  cent  of  the  output  of  all 
dairy  products — wholemilk,  cream,  skimmilk,  and  herd  increase.  If 
the  landlord  furnishes  a  part,  usually  one-half  of  the  cows,  his  share 
is  increased  to  from  40  to  50  per  cent.  If,  as  is  sometimes  the  case,  the 
landlord  supplies  all  the  cows,  he  claims  50  to  60  per  cent  of  the  gross 
income. 

In  Kings  County,  if  the  landlord  supplies  one-half  the  cows  and 
other  equipment  to  a  varying  extent,  he  receives  50  to  60  per  cent  of 
the  cash  sales  and  one-half  of  the  herd  increase.  In  San  Joaquin 
County,  the  share  rent,  commonly  50-50,  is  increased  to  60  per  cent  to 
the  party  furnishing  all  the  irrigation  water.       Share  renting,  some- 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND   LEASING  23 

what  uncommon  in  Sonoma  and  Marin  counties,  is  on  a  50-50  basis, 
each  furnishing  one-half  the  cows.  One  Sacramento  County  lease  pro- 
vides that  the  landlord  shall  furnish  land,  buildings,  hay,  silage,  cows, 
one-half  the  hogs,  and  pay  for  one-half  of  any  purchased  feed,  the 
tenant  furnishing  work  stock,  implements  and  labor,  on  an  agreed  divi- 
sion of  dairy  product  sales,  60  per  cent  to  landlord  and  40  per  cent  to 
tenant,  while  hog  receipts  are  to  be  divided  50-50.  In  a  Santa  Clara 
County  lease,  the  landlord  furnishes  land,  buildings,  work  stock,  cows 
and  hogs,  one-half  the  cost  of  seed  and  pumping  plant  fuel,  one-half 
the  cost  of  purchased  feed,  one-half  the  cost  of  shoeing  and  one-half 
the  veterinary  bills  incurred  in  connection  with  horses.  The  landlord's 
share  is  50  per  cent  of  milk,  calves,  and  pigs,  while  he  reserves  all 
receipts  from  sale  of  cows,  brood  sows,  work  stock,  and  colts  from 
work  stock. 

Apparently,  the  50-50  lease  is  the  favorite,  and  an  attempt  is  com- 
monly made  to  adjust  the  items  that  each  is  to  supply  so  that  each 
shall  be  entitled  to  one-half  the  gross  income  from  sales  or  increase  of 
stock.  Thus,  while  most  landlords  look  to  the  tenant  to  meet  operating 
expenses,  if  it  is  necessary  to  make  concessions  in  order  to  equalize 
each  party's  contribution,  the  landlord  occasionally  agrees  to  pay  for 
one-half  of  all  purchased  feed  or  one-half  the  pumping  plant  operating 
costs,  or  make  some  similar  adjustment  of  costs. 

A  Stanislaus  County  lease  provides  that  the  tenant  shall  furnish 
all  cows,  raising  for  himself  such  heifer  calves  as  he  may  desire  to 
retain.  The  landlord  pays  45  per  cent  of  the  cost  of  hay  purchased. 
He  then  receives  45  per  cent  of  receipts  from  the  sale  of  dairy  products 
and  calves  other  than  those  reserved.  A  Sacramento  County  lease 
provides  that  the  tenant  shall  raise  one  heifer  each  year  for  every  five 
cows  in  the  milking  herd,  the  landlord  furnishing  all  cows,  division  to 
be  50-50  for  all  cream,  hogs,  and  calves  over  and  above  those  reserved. 
Protection  of  the  landlord's  investment  in  cows  and  horses  is  covered 
in  a  Fresno  County  lease  by  setting  a  stated  sum,  in  this  case  $62.50, 
that  the  tenant  is  to  pay  in  the  event  of  any  cow  dying  because  of 
the  tenant's  neglect,  and  $87.50  for  each  mare  so  dying. 

The  tenant  commonly  furnishes  all  labor  in  connection  with  the 
running  of  the  dairy  and  the  production  of  feed  crops  and  generally 
all  seed  other  than  for  reseeding  or  planting  alfalfa.  If  repairs  of 
improvements,  e.g.,  buildings,  fences,  troughs,  and  water  pipe  are 
made,  the  landlord  commonly  supplies  the  material,  the  tenant  the 
labor.  Whitewashing  materials  and  squirrel  poison  are  also  often 
furnished  by  the  landlord,  the  tenant  doing  the  necessary  work. 


24  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT    STATION 

When  hay  or  other  harvested  or  purchased  feed  is  on  hand  at  the 
time  a  tenant  takes  possession,  he  is  called  upon  either  to  buy  the  feed 
on  hand,  or,  in  the  event  that  the  landlord  prefers  to  have  a  supply 
of  feed  for  the  use  of  the  next  succeeding  tenant,  the  lease  provides 
that  an  amount  equal  in  quality  and  quantity  shall  be  left  on  the  place 
at  the  expiration  of  the  lease  period.  Occasionally,  provision  is  inserted 
in  the  lease  to  help  in  enforcing  this  demand  should  the  tenant  fail  to 
live  up  to  the  agreement.  In  some  instances,  the  landlord  and  tenant 
share  equally  the  cost  of  testing  the  cows. 

When  alfalfa  land  is  an  important  adjunct  to  the  dairy,  the  agree- 
ment stipulates  the  manner  of  handling  the  alfalfa  land.  Reseeding 
of  existing  alfalfa  acreages  or  putting  in  of  new  alfalfa  plantings  is  a 
common  provision.  For  this  purpose,  many  landlords  furnish  the 
seed,  while  the  tenant  does  the  work  of  preparing  the  land  and  caring 
for  the  crop  until  it  reaches  maturity,  receiving  in  return  free  rent 
for  the  first  year  as  compensation  for  the  work. 

The  pasturing  of  alfalfa  is  often  denned,  permission  to  pasture 
being  limited  to  certain  fields  or  to  certain  stages.  Denying  the  tenant 
the  privilege  of  running,  livestock  on  alfalfa  during  the  rainy  season 
or  when  the  fields  are  wet  from  irrigation  is  a  common  provision. 
Sometimes  an  exception  is  made  when  corrals  are  muddy.  Length  of 
the  lease  varies  from  one  to  fifteen  years,  with  the  more  common  length 
of  tenure  placed  at  from  three  to  five  years.  The  practice  varies  in 
different  communities,  however.  Humboldt  County  leases  are  mostly 
for  five  years,  while  some  are  for  ten  years,  and  a  few  for  three  years. 
In  Imperial  County  one-,  two-,  and  three-year  leases  are  used.  In 
Kings,  Marin,  Merced,  Monterey,  San  Luis  Obispo,  San  Mateo, 
Sonoma,  and  Stanislaus  counties,  leases  of  from  three  to  five  years  are 
commonly  used.  The  tendency  is  in  the  direction  of  providing  the 
tenant  with  longer  periods  in  sections  and  on  ranches  where  the 
one-  and  two-year  leases  are  being  followed.  Leases  of  seven,  ten,  or 
more  years  are  found  only  in  rare  instances. 

In  Contra  Costa  and  San  Mateo  counties  leasing  of  cultivated 
lands  is  usually  on  a  crop  basis.  The  landlord  furnishes  land  and  the 
usual  improvements,  receiving  for  the  use  thereof  a  share  of  the  crop 
produced,  as,  for  example,  one-fourth  of  all  hay  or  grain  produced, 
while  the  tenant  is  permitted  the  privilege  of  keeping  dairy  cows  to 
consume  his  share  of  all  crops  grown. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND.  LEASING  25 


LEASING  LANDS  FOR  TRUCK  CROPS 

Two  types  of  truck  growing  cause  variation  in  leasing  practi< 
yet  the  ground-plan   is  sufficiently   standardized  to   permit   certain 
generalizations. 

Vegetable  lands  near  cities  are  rented  for  the  purpose  of  raising 
a  variety  of  crops  for  the  more  or  less  continuous  retail  supplying  of 
local  markets,  including  such  crops  as  carrots,  beets,  lettuce,  green 
onions,  cauliflower,  cabbage,  peas,  celery,  spinach,  turnips,  and  early 
potatoes.  Areas  leased  for  such  purposes  are  small,  usually  five  to 
fifteen  acres,  and  are  upon  a  cash  basis,  mostly  of  from  $40  to  $50 
per  acre  per  year,  witji  leases  commonly  for  from  three  to  five  years. 

Lands  leased  for  field  culture  of  such  crops  as  potatoes,  onions, 
cantaloupes,  sweet  potatoes,  artichokes,  cucumbers,  tomatoes,  cabbage, 
cauliflower,  and  Brussells  sprouts  may,  under  California  conditions, 
properly  be  classed  as  field  crops.  Acreages  usually  range  from  20 
to  100  acres  or  more,  with  the  tenant  concentrating  on  production  of 
but -one,  two,  or  at  most  a  very  limited  number  of  crops,  raised  and 
handled  in  a  wholesale  way. 

,  The  length  of  lease  is,  variable,  custom  in  some  communities  favor- 
ing the  annual  lease  while,  in  other  sections,  leases  from  three  to  five 
years  are  common.  Both  cash  and  share  methods  are  generally  fol- 
lowed. Cash  rents  range  from  about  $15  to  $75  per  acre  per  year, 
with  $30  to, $40,  being  the  more  common  range.  The  higher  rates  hold 
for  specially  desirable  lands, -the  lower  figure  for  the  poorer  producing 
or  more  remote  holdings.  One  interesting  lease  of  cantaloupe  land 
calls  for  $30  cash  rent  per  acre,  to  be  increased  to  $35  if  the  acre  yield 
runs  to  175  full  crates  or  more.  Cash  rents  are  collectable  either 
annually  or  semi-annually  in  advance,  although  some  leases  provide 
for  a  stated  amount*  one-third  for  example,  when  the  contract  is  signed, 
and  the  remainder  out  of  the  first  ^proceeds  from  the  sale- of  crops. 
Monthly  payments  are  occasionally  exacted.  Occasionally  a  graduated 
scale  is  provided,  as  for  example,  a  three-year  lease  which  requires  $18 
an  acre  the  first  year  and  $30  an  acre  for  each  of  the  second  and  third 
-years.  .  When ._.; the  share  metho4-.^s  used,  the  landlord  usually  receives 
one^fourth  to-  one-third  when  furnishing  land  and  buildings  or  other 
similar  improvements.  If,  in  addition,  the  landlord  supplies  work 
stock,  implements,  seeds,  or  plants,  and  water,  his  share  is  increased 
to  from  50  to  60.  per  cent.  Other  provisions  occasionally  found  pro- 
vide 'that  the  landlord. .will  furnish  only  a  part,  as  one-half,  of  the 
plants,  sets,  or  seeds,  or  that  he  will  furnish  one-half  the  feed  for  the 


26  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

work  stock,  or  pay  a  part,  as  one-third  or  one-half,  of  the  cost  of  market 
packages.  It  would  appear  that  most  landlords  and  tenants  consider 
the  land  and  buildings  as  constituting  about  30  per  cent,  labor  40 
per  cent,  and  water,  work  stock,  implements,  seed,  feed  and  market 
packages  as  30  per  cent  of  the  total  contribution. 


LEASING  STEAWBEEEY  LANDS 

The  renting  of  strawberry  lands  is  upon  both  cash  and  share  basis. 
The  cash  paid  varies  from  $30  an  acre  to  as  high  as  $100  for  extra 
choice  fields,  with  $50  a  common  figure.  Strawberry  leases  are  usually 
made  to  cover  the  life  of  the  beds,  that  is,  three  or  four  years.  The 
acreages  vary  from  2  or  2%  acres,  cared  for  by  a  family  (almost 
invariably  Japanese),  to  areas  as  high  as  20  acres,  farmed  by  a  com- 
pany. Share  rentals  are  commonly  split  50-50,  although  there  is  some 
variation,  as,  for  instance,  45  per  cent  to  landlord  and  55  per  cent 
to  tenant.  The  landlord  usually  supplies  land,  buildings,  work  stock, 
implements  and  plants  for  setting  out,  and  sometimes  agrees  to  meet 
a  part  or  all  of  the  cost  of  the  irrigation  water.  The  tenant  agrees  to 
supply  the  necessary  labor  for  preparing,  planting,  and  caring  for 
beds,  picking,  packing,  and  shipping  of  berries,  and  maintaining  of 
ditches.  Occasionally,  the  tenant  is  also  called  upon  to  remove  the 
plants  at  the  expiration  of  lease. 

The  form  of  contract  follows  the  usual  plan  of  most  leases  designed 
to  cover  the  demising  of  deciduous  orchards,  under  terms  of  either 
cash  or  share  rent,  according  to  the  plan  to  be  followed. 


LEASING  POULTRY  PLANTS 

It  appears  that  very  little  leasing  of  poultry  farms  is  practiced, 
owners  preferring  either  to  handle  them  in  person  or  through  a  paid 
manager,  or  else  to  sell  out  in  the  event  that  they  are  unable  to  provide 
the  necessary  personal  supervision  and  rather  close  attention  to  details 
required  by  the  business.  Our  field  investigations  brought  to  light 
very  few  leased  poultry  plants. 

A  lease  in  Santa  Cruz  County  appearing  on  the  books  in  the  County 
Recorder 's  office  specifies  the  cooperative  handling  of  poultry  on  a  five- 
acre  place,  leased  for  sixteen  months,  under  terms  by  which  the  land- 
lord furnishes  land,  poultry,  chicken  houses,  water,  team  work,  and 
delivery  of  eggs,  while  the  lessee  furnishes  the  labor.  The  plant  pro- 
vides for  an  equal  division  every  three  months  of  any  money  in  the 
treasury  above  five  hundred  dollars. 


CIRCULAR   272]  CALIFORNIA    FARM    TENANCY   AND   LEASING  27 

In  the  Petaluma  district  Sonoma  County,  estimates  of  tenancy  place 
the  percentage  at  from  1  to  5  per  cent.  The  reason  given  for  tenancy 
in  poultry  is  usually  that  the  owners  are  called  away  so  suddenly  that 
they  do  not  have  an  opportunity  to  sell.  In  general,  poultry  leasing 
requires  but  small  acreages,  2  to  10  acres  being  the  usual  size  of  the 
leased  properties,  with  5  acres  being  the  more  common.  The  longer 
leases  are  more  common,  running  to  from  3  to  5  years,  although  some 
annual  leases  are  to  be  found.  Cash  renting  is  usual,  averaging  ( 1922) 
about  $200  to  $240  for  a  five-acre  piece  which  amounts  to  from  $40  to 
$50  per  acre.  The  landlord  usually  furnishes  land,  buildings,  improve- 
ments, and  sometimes  tools  and  implements.  The  tenant  supplies  hens, 
labor,  feed,  power,  tools,  and  implements  when  these  are  not  a  part 
of  the  landlord 's  contribution. 

A  turkey  lease  in  San  Luis  Obispo  County  provides  for  a  five-year 
agreement  with  the  option  of  an  additional  five  years,  under  terms  that 
provide  for  a  division  of  one-third  to  the  landlord  and  tAvo-thirds  to 
the  tenant.  The  division  is  on  the  basis  of  weight  figured  upon  a 
representative  lot  of  turkeys  to  be  weighed  each  year  about  March  15 
and  again  November  1,  the  difference  in  weight  to  be  the  basis  of 
division.  The  landlord  grants  the  use  of  3000  acres  of  range,  furnishes 
a  36-inch  field  fence  to  enclose  the  place,  and  2200  feet  of  wire  fencing 
for  the  turkey  yards.  The  tenant  is  to  furnish  all  labor,  is  held  respon- 
sible for  air  operations,  agrees  to  keep  no  turkeys  between  March  15 
and  November  15  without  written  consent  from  the  landlord,  and  will 
incubate  a  minimum  of  3700  turkey  eggs  yearly.  Cash  reimbursement 
to  the  tenant  is  provided  in  the  event  that  the  property  is  sold  or  the 
tenant  deprived  of  the  range. 

A  Sacramento  Valley  lease  provides  for  the  raising  of  turkeys  in 
connection  with  grain  growing  on  a  240-acre  ranch.  The  plan  provides 
that  the  landlord  shall  furnish  a  given  number  of  turkeys,  as  he  may 
elect,  to  be  cared  for  by  the  tenant  for  one  year,  and  fed  at  the  expense 
of  both  parties  share  and  share  alike.  At  the  conclusion  of  the  year, 
after  making  good  any  loss  of  the  original  breeding  stock  from  the 
young  birds,  the  increase  is  to  be  computed  and  divided  50-50. 

LEASING  LIVESTOCK  RANGES  AND  RANCHES 

The  majority  of  ranges  and  livestock  ranches  are  leased  for  cash, 
the  landlord  furnishing  land,  sometimes  buildings,  fences,  and  stock 
water.  There  is  much  variation  in  character  of  the  land — from  swamp 
or  over-flow  to  sparsely  covered  rolling  hills  or  rocky,  precipitous 
mountain  lands,  in  leasing  rates,  in  length  of  leasing  and  in  size  of 


28  UNIVERSITY    OF    CALIFORNIA— EXPERIMENT    STATION 

holdings.  Carrying  capacity  varies  widely  in  different  parts  of  the 
range  country,  as  do  the  extent,  nature,  and  value  of  the  improvements. 
Holdings  vary  in  size  from  160  acres  to  several  thousand  acres.  Cash 
rates  run  from  an  occasional  figure  of  5  cents  to  as  high  as  $5  an  acre 
a  year.  Manay  leases  run  from  50  cents  to  $1  an  acre  a  year,  others 
are  as  low  as  20  to  25  cents,  while  still  others  command  from  $1.25 
to  $1.50  an  acre.  Length  of  leases  is  from  1  to  15  years,  with  a  goodly 
number  of  2-,  3-,  and  5-year  leases.  Annual  leases  are  not  particularly 
suited  to  most  phases  of  livestock  handling  and  hence  are  not  favorably 
considered  unless  the  range  is  in  addition  and  secondary  to  farming 
land.    Rents  are  usually  payable  annually  or  semi-annually  in  advance. 

A  rough  rule  used  by  some  stockmen  is  to  figure  annual  value  of 
pasturage  per  head  and  then  determine  the  rate  per  acre  by  estimating 
carrying  capacity  of  range.  For  example,  if  pasturage  for  beef  cattle 
is  considered  worth  $12  per  year  and  it  requires  40  acres  to  run  an 
animal,  the  rate  per  acre  is  30  cents ;  if  only  15  acres  are  needed,  the 
rate  is  figured  to  be  80  cents.  Under  present  day  conditions,  pasturage 
per  head  is  commonly  placed  at  $1  to  $1.50  per  head  per  month  for 
beef  or  dairy  cattle,  or  $1.50  to  $2.50  per  head  per  month  for  horses 
or  mules.  From  eight  to  ten  sheep  are  considered  equivalent  to  one 
cow  or  steer  in  estimating  pasture  needs. 

A  few  cattle  ranches,  equipped  and  stocked,  were  reported  as 
under  lease  on  the  share  basis,  under  terms  by  whicfr  the  landlord 
furnishes  the  land,  improvements,  stock,  and  equipment,  the  tenant 
supplying  labor  in  caring  for  the  stock,  in  maintaining  the  plant,  and 
in  putting  up  feed  for  use  during  times  of  shortage  of  feed  or  to  finish 
for  market,  each  to  share  equally  (50-50)  in  the  increase.  Sometimes 
provision  is  made  for  replacing  a  stated  number  or  percentage  of  breed- 
ing stock,  or  for  culling,  to  insure  the  return  to  the  landlord  of  his 
original  stock  in  undiminished  number  and  value.  In  some  sections, 
e.g.,  Riverside  County,  some  contracts  are  apparently  based  on  the 
belief  that  the  tenant's  labor  offsets  the  landlord's  land,  so  that  each 
party  agrees  to  supply  one-half  the  livestock,  sharing  50-50  in  the 
output. 

The  contract  covering  the  leasing  of  livestock  ranges  tends  to  be 
simply-worded,  short,  and  concise. 

LEASING  METHODS  IN  THE  SACRAMENTO  AND  SAN  JOAQUIN  DELTAS 

The  Sacramento  and  San  Joaquin  deltas,  two  groups  of  islands 
situated  at  the  mouths  of  the  rivers  of  the  same  names,  in  varying 
stages  of  reclamation  and  development,  follow  local  practices  some- 
what different  from  those  usually  used  on  neighboring  mainlands. 


CIRCULAR   272]  CALIFORNIA   FARM   TENANCY   AND   LEASING  29 

There  are  two  distinct  deltas,  each  having  its  own  soil  types,  crops,  and, 
to  a  minor  extent,  local  leasing  methods. 

In  the  Sacramento  delta,  the  more  generally  grown  field  and  truck 
crops  of  barley,  alfalfa,  corn,  potatoes,  onions,  celery,  beans,  and  seed 
are  supplemented  with  asparagus,  berries,  orchards  of  pears,  plums, 
and  occasionally  apples,  peaches,  and  other  deciduous  crops.  In  the 
San  Joaquin  delta,  little  asparagus  and  fruit  are  grown,  the  plantings 
running  more  to  barley,  corn,  onions,  potatoes,  and  alfalfa. 

The  Sacramento  Delta. — In  the  Sacramento  delta,  the  size  of  leased 
tracts  runs  relatively  large,  being  mostly  from  160  to  800  acres,  with 
a  few  holdings  either  smaller  or  larger.  Since  an  island  must  be 
handled  to  a  considerable  extent  as  a  unit,  especially  as  to  irrigating 
and  draining,  the  tendency  is  toward  similar  types  of  farming  and  to 
as  few  individual  leases  as  practical. 

Both  share  and  cash  leases  are  in  use,  each  being  well  represented. 
Leases  run  for  one,  two,  and  three  years,  with  some  for  five  years,  a 
few  for  ten  years,  and  occasionally  a  twelve-year  lease,  the  longer 
leases  being  usually  for  asparagus  plantings,  In  general,  cash  leases 
usually  cover  shorter  periods  of  time  than  do  leases  drawn  upon  the 
share  basis.    Annual  leases  are  most  commonly  used. 

Rates  fluctuate  materially  from  year  to  year,  depending  on  expected 
prices  for  the  product,  and  operating  costs. 

Leases  now  in  force  are  fairly  uniform.  Cash  rents  (1922)  for 
land  to  be  used  for  beans,  barley,  alfalfa,  potatoes,  seed,  or  grain  hay 
range  from  $20  to  $40  an  acre,  with  $25  to  $30  an  acre  constituting 
the  basis  of  the  majority  of  leases. 

Cash  rents  for  asparagus  are  from  $25  to  $40  an  acre,  or  an  average 
of  about  $30  (1923). 

The  share  of  the  crop  paid  for  lands  utilized  for  beans,  barley, 
alfalfa,  seed,  and  grain  hay  is  usually  one-third,  although  occasionally 
35  to  40  per  cent.  At  these  rates,  the  landlord  furnishes  land,  build- 
ings, and  pumping  plant,  pays  taxes,  and  keeps  up  levees.  The  tenant 
supplies  all  working  equipment,  seed,  and  sacks,  and  meets  all  labor 
and  harvest  costs.  Should  the  landlord  supply  work  stock,  one-half 
the  seed,  one-half  the  feed,  one-half  the  sacks  or  packing  boxes,  and 
sometimes  one-half  the  threshing  charge,  his  share  is  placed  at  50  per 
cent  of  the  gross  output.  Sugar  beets,  limited  in  acreage,  are  shared 
one-fourth  to  landlord,  balance  to  the  tenant.  Thirty-five  per  cent  of 
barley  to  the  landlord  is  also  about  as  common  as  the  one-third  rate. 

Share  leases  of  potato  lands  ordinarily  provide  that  the  landlord 
shall  receive  one-fourth  the  crop.  Celery  and  onions  are  shared  one- 
fifth  to  the  landlord,  remainder  to  the  tenant. 


30  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

Asparagus  leases  on  a  share  basis  give  40  to  60  per  cent  to  the 
landlord  if  he  furnishes  land,  buildings,  teams,  all  equipment,  and  one- 
half  the  packing  boxes,  and  advances  some  money  to  the  tenant  to 
pay  operating  expenses.  Asparagus  leases  usually  run  from  three  to 
ten  years,  with  an  occasional  twelve-year  lease.  Intercrops  planted 
for  three  years  between  the  rows  of  new  asparagus  settings  are  com- 
monly shared  one-fourth  for  the  first  two  years,  and  two-fifths  the 
third  year  to  landlord. 

Occasionally  a  clause  is  inserted  setting  a  cash  rate  (e.g.,  $15  per 
acre)  to  be  paid  for  lands  not  put  in  crops  even  though  the  main 
contract  is  drawn  upon  a  share  basis. 

Graduated  schedules  are  also  in  force,  particularly  when  new  land 
is  to  be  broken  and  subdued,  or  when  asparagus  is  to  be  planted.  An 
example  of  such  a  lease  is  one  based  on  cash  rent  providing  for  increas- 
ing rates,  starting  at  $10  an  acre  the  first  year,  then  $12.50  the  second, 
$17.50  the  third,  $22.50  the  fourth,  and  $25  the  fifth  year.  These 
rentals  were  based  on  the  rates  of  $30  to  $40  for  fully  producing  land 
which  prevailed  when  the  contract  was  drawn  up.  A  share  basis, 
similarly  determined,  provides  that  the  landlord  shall  receive  15  per 
cent  of  the  crop  the  first  year,  25  per  cent  the  second,  and  35  the  next 
three  years,  with  barley  the  crop  to  be  grown.  A  sample  asparagus 
lease  calls  for  $10  an  acre  the  first  year,  $14  for  each  the  second  and 
third  years,  $18  the  fourth,  $22.50  the  fifth,  and  $27.50  annually  for 
the  next  seven  years.  Another,  a  cash  lease  of  asparagus  land,  provides 
for  payments  of  $25  rent  per  acre  annually  for  the  first  six  years  and 
$30  per  acre  annually  for  the  last  six  years.  Another  lease  calls  for  27 
per  cent  of  the  asparagus,  if  already  planted  when  the  tenant  takes 
hold,  or  25  per  cent  if  the  tenant  plants  the  crop.  In  one  lease,  a 
provision  is  made  that  should  the  land  be  double  cropped,  although  on 
a  cash  lease  basis,  the  landlord  is  to  receive  35  per  cent  of  the  second 
crop. 

A  unique  bean  lease  takes  into  account  the  respective  amounts  of 
landlord's  and  tenant's  investments  and  the  market  price  for  the  crop. 
Thus,  if  beans  bring  four  cents,  the  landlord's  share  is  set  at  45  per 
cent,  if  five  cents,  at  50  per  cent,  if  six  cents,  at  55  per  cent,  with  pro- 
portionate percentages  for  other  prices.  Under  this  agreement,  the 
tenant  furnishes  feed,  seed,  work  stock,  implements,  and  labor,  and 
pays  for  one-half  the  electricity  used  in  pumping. 

The  San  Joaquin  Delta. — In  the  San  Joaquin  delta,  the  size  of 
tracts  is  also  relatively  large.  Cash  rents  are  less  common  than  share 
rents.  When  rented  for  cash,  land  to  be  planted  to  corn,  beans,  or 
barley  commands  annual  rents  of  from  $12  to  $40  an  acre,  with  $18  to 
$20  the  usual  rate. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND   LEASING  31 

Share  rents  in  the  San  Joaquin  delta  range  around  one-fourth  to 
one-third  to  the  landlord  for  corn,  one-fourth  to  one-third  for  beans 
(30  per  cent  being'  a  common  figure,  while  35  per  cent  is  occasionally 
required),  one-third  to  two-fifths  for  barley,  and  one-fifth  to  one- 
fourth  for  hemp,  the  tenant  to  furnish  everything  except  land,  build- 
ings, and  pumping  plant.  If  the  landlord  furnishes  work  stock  and 
a  part  or  all  of  the  seed  and  feed,  the  share  to  the  landlord  is  one-half. 
Potatoes  and  celery  are  shared  one-fourth  to  the  owner  (in  one  type  of 
lease  23  per  cent).  In  certain  leases,  onions  are  shared  40  per  cent  and 
potatoes  45  per  cent  to  the  landlord,  the  landlord  meeting  a  part  of  the 
operating  expenditures,  such  as  furnishing  seed  or  one-half  the  feed 
or  one-half  the  sacks.  One  potato  lease  provides  that  the  landlord 
shall  furnish  seed  potatoes  to  the  extent  of  eight  sacks  per  acre  and 
45  per  cent  of  the  cost  of  sacks  (but  not  twine),  receiving  45  per  cent 
of  the  potato  crop,  or  $30  per  acre  cash  for  any  lands  not  planted. 

Two  sugar  beet  leases  under  which  the  landlord  furnishes  land, 
buildings,  implements,  and  one-half  the  feed  give  the  landlord  30  and 
35  per  cent  of  the  crop,  respectively. 

Length  of  leases  corresponds  closely  with  those  of  the  Sacramento 
delta,  although  it  appears  that  two-  and  three-year  leases  are  common, 
including  both  cash  and  share  leases. 

General  Provisions  in  Delta  Land  Leases. — Because  of  danger  from 
peat  fires,  the  necessity  of  maintaining  levees,  the  need  for  proper 
handling  of  irrigation  and  drainage  water,  and  heavy  weed  growths, 
provisions  are  common  in  leases  of  both  the  Sacramento  and  San 
Joaquin  deltas  dealing  with  these  matters.  Provisions  imposing  cau- 
tion in  controlling  fires  by  tenant  or  prohibiting  setting,  and  fixing 
the  responsibility  of  tenant  for  damages  resulting  from  fires,  are 
commonly  inserted.  So,  too,  are  reservations  permitting  landlord's 
use  of  soil  from  fields  for  repairing  or  enlarging  levees.  Waivers  by 
landlords  of  responsibility  for  damage  from  overflow  or  seepage  are 
common.  Details,  sometimes  very  complete,  governing  the  method 
of  preparing  the  land,  time  of  planting,  care  of  growing  crops,  build- 
ing of  field  ditches,  clearing  of  main  supply  ditches,  time  and  manner 
of  harvesting  are  ordinarily  fully  set  forth.  An  interesting  provision 
of  one  lease  rules  that  no  vehicle  having  tires  less  than  four  inches 
in  width  shall  be  used  for  hauling  purposes.  Pasturing  of  work 
stock  is  occasionally  prohibited,  and  if  permitted  the  extent  to  which 
cows  and  hogs  may  be  kept  is  often  clearly  defined.  The  right  to 
commandeer  help  from  the  tenant  during  high  water  in  protecting 
levees  is  made  a  part  of  some  leases. 


32  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT   STATION 

Terms  and  manner  of  paying  rents  are  explicit.  Ownership  of 
crops  grown  under  share  leases  is  commonly  retained  by  the  landlord 
Who  sometimes  further  reserves  the  right  to  sell  and  reimburse  the 
tenant  for  his  share.  Cash  rents  are  usually  payable  either  annually 
or  semi-annually,  in  advance,  or  one-half  at  time  of  signing  the  lease 
and  the  remainder  when  the  first  crops  are  sold.  As  a  guarantee  that 
the  tenant  will  carry  out  the  terms  of  the  lease,  some  contracts  provide 
for  the  reserving  of  a  stated  sum  from  the  proceeds  of  all  crops  sold 
pending  the  tenant's  completion  of  his  various  obligations;  as,  in  one 
case,  $3  an  acre  until  ditches  are  cleared  and  put  in  order.  Some 
landlords  protect  themselves  by  having  their  tenants  execute  crop 
mortgages  in  favor  of  the  landlords. 

To  protect  the  tenant  in  the  event  that  his  crops  (celery,  for 
instance) ,  cannot  be  harvested  within  the  time  limits  of  the  lease,  an 
extension  of  time,  commonly  60  or  90  days,  is  sometimes  provided  for. 

GENEEAL  PEO VISIONS  COMMON  TO  FAEM  LEASES 

Certain  provisions  are  common  to  all  leases. 

Outstanding  in  careful  wording  and  frequent  appearance  is  the 
provision  for  insuring  payment  of  rents  in  full  and  complete  accord- 
ance with  the  stipulations  of  the  lease.  The  lease  sets  forth  the  amount 
of  rent,  and  when,  where,  and  how  payable.  Cash  rents  are  usually 
specified  as  stated  amounts,  usually  payable  either  annually,  semi- 
annually, quarterly,  or  monthly  as  agreed  upon,  the  amounts  being 
proportioned  equally  or  else  based  upon  a  sliding  scale  of  payments. 
Payment  in  advance  is  usually  exacted  from  cash  renters.  Share 
leases  designate  the  proportion  of  product  which  is  to  be  paid  to  the 
landlord,  stipulate  how  this  share  shall  be  selected  and  prepared  (as 
hay  to  be  baled,  grain  to  be  sacked),  and  stipulate  the  place  of  deliver- 
ing the  owner's  share.  Reservation  of  the  privilege  of  selling  the  total 
output  by  the  landlord  is  sometimes  a  part  of  the  contract. 

Second  only  to  rental  rates  and  methods  of  payments  in  importance 
are  provisions  by  which  the  landlord  retains  full  control  of  the  prop- 
erty at  all  times.  These  provisions  vary  in  phraseology  but  are 
designed  to  permit  the  taking  over  of  the  property  in. the  event  of 
apprehension  concerning  prompt  and  full  payment  of  rents,  or  if  the 
tenant  fails  to  live  up  to  his  agreement. 

Similar  provisions  are  those  designed  to  prevent  assigning  or  sub- 
letting of  the  lease. 

Of  little  legal  importance  but  of  considerable  significance  are 
stipulations  to  the  effect  that  the  property  is  to  be  handled  in  a  farmer- 
like manner,  after  the  custom  of  the  community. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY    AND   LEASING  33 

A  clause  common  to  many  leases  specifically  exempts  the  landlord 
from  liability  for  any  injury  or  damage  to  lessee's  share  of  livestock 
or  crops  from  fires,  droughts,  insufficiency  of  irrigation  water,  floods 
or  similar  catastrophes. 

Occasionally  leases  under  which  the  landlord  furnishes  work  stock 
and  farm  implements  contain  a  clause  setting  forth  that  the  equipment 
furnished  is  to  be  used  solely  in  farming  the  demised  property  and  in 
delivering  to  market  the  crops  or  products  produced  thereon. 

A  rather  common  provision  sets  forth  that  the  tenant  to  the  best  of 
his  ability  is  to  keep  the  premises  free  and  clear  of  weeds,  squirrels, 
gophers,  and  similar  pests.  The  extent  to  which  the  tenant  must  go 
in  clearing  land  of  noxious  weeds  is  sometimes  settled  by  inserting  a 
clause  providing  that  the  work  shall  be  done  to  the  satisfaction  of  the 
county  officials  having  charge  of  such  work. 

Some  leases  carry  an  option  granting  permission  to  the  tenant  to 
renew  the  lease  for  an  additional  period — usually  one  to  two  years — 
at  the  same  rate,  provided  written  notice  is  given  of  the  desire  to  renew 
within  a  specific  time  prior  to  the  expiration  date  of  the  lease.  The 
notification  period  may  be  as  short  as  fifteen  days,  or  as  long  as  three 
months,  the  shorter  period  obtaining  for  annual  leases  of  field  crops, 
land,  or  orchards,  the  longer  period  for  dairies,  ranches,  and  livestock 
ranges. 

A  provision  set  forth  in  communities  having  strong  farmers '  market 
organizations  provides  that  crops  grown  and  produced  upon  the  leased 
lands  are  subject  to  sale  under  contract  made  with  a  specified  associa- 
tion, such  as  the  sale  of  raisins  to  the  Sunmaid  Raisin  Association, 
peaches  and  figs  to  the  Associated  Fig  and  Peach  Growers'  Association, 
or  pears  to  the  California  Pear  Growers'  Association. 

On  ranches  possessing  private  pumping  plants,  the  more  common 
practice  is  for  the  tenant  to  pay  the  operating  expenses. — fuel  or  power, 
although  the  rule  is  subject  to  quite  a  number  of  exceptions  under 
which  the  lessor  may  meet  a  part  of  the  fuel  or  power  bills  and  in  some 
instances  pay  the  entire  power  bill. 

Objection  to  running  hogs  at  large  is  general  and  many  leases 
specifically  prohibit  the  practice. 

When  irrigation  ditches  constitute  a  part  of  the  rented  properties 
many  leases  provide  that  the  tenant  shall  properly  work  the  banks 
and  keep  them  in  good  condition  and  repair. 

The  cutting  of  firewood  is  a  factor  in  leases  in  both  timber  sections 
and  where  wood  is  scarce.  Some  leases  prohibit  the  cutting  of  any 
wood,  others  specify  that  fallen  or  dead  trees  only  are  to  be  used. 
Landlords  often  reserve  rights  to  themselves  for  cutting  timber  o>- 
fuel. 


34  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT    STATION 

Clauses  protecting  portions  of  the  property  which  are  not  the  pri- 
mary causes  of  leasing,  such  as  family  orchards  and  vineyards,  land- 
scape planting,  shade  trees,  and  small  streams,  are  common. 

In  sections  where  there  is  much  buying  and  selling,  it  is  a  common 
practice,  in  the  event  of  a  bona  fide  sale  of  leased  lands,  to  provide  for 
reimbursing  a  tenant  for  work  done  up  to  the  time  of  cancelling  the 
lease.  In  some  grain  leases,  for  instance,  the  landlord  agrees  to  pay 
a  tenant  in  the  event  of  a  sale  at  the  rate  of  $2  to  $2.50  an  acre  for 
all  summer  fallowed  land  which  has  had  a  single  plowing,  and  $3  to 
$3.50  an  acre  for  all  lands  plowed  twice. 

Many  leases  stipulate  that  the  premises  are  to  be  kept  in  good 
condition,  fences  and  buildings  to  be  maintained  in  good  repair,  equip- 
ment to  be  kept  in  good  shape  with  any  lost,  broken,  or  wornout  parts 
to  be  replaced.  In  the  case  of  buildings  and  fences,  the  usual  plan  is 
for  the  landlord  to  furnish  the  necessary  materials  and  the  tenant  to  do 
the  work,  the  same  plan  commonly  being  followed  in  repairing  ditch 
gates  and  boxes. 

Many  leases  contain  a  clause  giving  the  tenant  the  option  to  pur- 
chase the  property,  or  in  the  event  that  the  landlord  ultimately  decides 
to  sell,  to  allow  the  tenant  to  have  the  first  chance  of  purchasing. 

Some  leases  allow  for  an  extension  of  time  to  permit  the  harvesting 
of  crops  grown  under  the  lease  but  which  could  not  be  removed  during 
the  leasing  period  because  of  reasons  beyond  control  of  the  tenant. 

To  provide  redress  in  the  event  that  the  tenant  does  not  perform 
his  work  in  a  good  and  farmer-like  manner,  neglects  any  of  his  duties 
in  connection  with  the  handling  of  the  ranch,  or  fails  to  live  up  to  the 
terms  of  the  lease,  almost  all  contracts  provide  for  the  landlord 's  com- 
pleting the  work  for  cost  plus  an  added  percentage  (e.g.,  10  per  cent) 
or  even  retaking  possession  with  the  tenant  agreeing  to  peaceable 
surrender. 

When  movable  equipment  is  furnished  by  the  landlord,  it  is 
customary  to  list  in  itemized  form  the  implements,  machinery,  live- 
stock, harness,  etc.,  even  to  such  articles  as  lead  bars,  eveners,  scythes, 
tools,  wire  stretchers,  and  post-hole  diggers.  The  right  to  sell  such 
items  is  sometimes  reserved,  with  use  granted  the  tenant  until  sale  is 
made. 

When  the  landlord  furnishes  work  stock,  the  lease  often  states  a 
sum  (e.g.,  $87.50)  which  the  tenant  must  pay  to  the  landlord  if  a 
work  animal  dies  as  a  result  of  the  tenant's  carelessness  or  neglect. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY   AND   LEASING  35 


PREPARING  THE  LEASE 

LEGAL  REQUIREMENTS 

According  to  the  California  statutes  a  lease  to  be  legal  must  (a)  be 
written  if  granted  for  more  than  one  year,  (6)  not  exceed  a  period  of 
fifteen  years  if  for  farm  property,  (c)  be  acknowledged  and  recorded 
in  the  local  county  courthouse  if  granted  for  more  than  one  year  (a 
certified  copy  of  the  lease  thus  recorded  in  the  courthouse  of  the  county 
where  the  property  is  located  possesses  the  same  force  and  effect  as  the 
original  instrument),  and  (d)  be  actually  delivered  to  the  grantee 
(tenant)  by  the  grantor  (landlord). 

FRAMEWORK  OF  THE  LEASE 

An  agreement  or  indenture  which  shall  fairly  protect  landlord, 
tenant,  and  property  should  be  a  written  instrument  setting  forth  all 
the  details  which  constitute  the  working  agreement.  It  should  be 
worded  as  simply  as  is  consistent  with  a  clear  statement  of  what  is 
agreed  upon  and  must  conform  to  the  legal  requirements  of  such 
documents.  The  legal  framework  is  built  upon  the  following  premises : 

1.  There  must  be  something  conveyed. 

2.  There  must  be  agreements  to  deliver  and  to  accept. 

3.  There  must  be  a  definite  statement  of  the  extent  and  bounds  of 
the  property. 

4.  There  must  be  set  forth  the  term  covered  by  the  lease. 

5.  There  must  be  a  financial  or  other  good  and  valuable  considera- 
tion involved. 

Items  common  to  every  farm  lease  are  : 

1.  Date  lease  is  drawn. 

2.  Names,  designations,  and  addresses  of  contracting  parties. 

3.  Statement  that  property  is  being  leased  by  landlord  and  lease 
accepted  by  tenant. 

4.  Description  of  property  being  leased. 

5.  Date  when  possession  is  to  begin. 

6.  Length  of  time  that  lease  is  to  run. 

7.  Types  of  farming  to  be  followed. 

8.  Rental  rate,  amount  and  division  of  income;  method  of  making 
payments — how,  when,  and  where. 

9.  Farming  methods  to  be  used. 

10.  What  is  to  be  furnished  by  each  party. 


36  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

11.  How  operating  funds  are  to  be  provided ;  contribution  of  each 
party. 

12.  Tenant's  assurances  and  guarantees, 

13.  Landlord's  assurances  and  guarantees. 

14.  Provisions  for  renewing  or  terminating  lease. 

15.  Safeguards  to  insure  proper  fulfillment  of  contract, 

16.  Signatures. 

17.  Witnesses. 

18.  Sealing  and  recording. 

ITEMS  TO  BE  CONSIDERED 

There  are  certain  general  provisions  which  are  pertinent  to  all 
leases.  These  are  listed  below  for  the  suggestive  value  that  they 
possess.  Items  such  as  these  should  be  given  careful  consideration 
when  framing  a  lease  and  either  accepted  and  incorporated  in  the 
lease  or  else  rejected  as  neither  vital  nor  necessary. 

In  addition  to  the  general  provisions,  there  are  special  considera- 
tions which  should  be  weighed  in  making  leases  for  certain  types  of 
agriculture.  Provisions  pertaining  especially  to  the  leasing  of  orchard 
and  vineyard  properties,  lands  for  field  crop  production  or  for  dairy- 
ing, and  livestock  ranges  are  also  given. 

No  attempt  is  here  made  to  set  forth  just  what  practice  should  be 
followed.  The  ethics  of  business  and  the  formulae  of  good  farming 
are  being  constantly  set  forth  in  various  publications.  What  con- 
stitutes the  best  procedure  is  not  difficult  of  determination  by  any 
enterprising  landlord  or  tenant.  The  purpose  here  is  to  call  attention 
to  the  desirability  of  giving  thought  to  what  is  best  from  the  stand- 
point not  only  of  landlord  and  tenant  but  as  well  of  the  land  and  its 
appurtenances. 

'   •  GENERAL  PROVISIONS 

Items  of  a  general  nature  which  should  be  considered  in  drawing 
up  a  farm  lease  are  listed  below.  These  supplement  the  items  set  forth 
under  "Legal  Requirements"  (page  35). 

1.  Disavowal  of  partnership,  if  joint  responsibility  is  not  con- 
templated in  order  to  avoid  partnership  liability  for  debt  or  other 
obligations. 

2.  Reservation  by  landlord  of  certain  buildings,  fields  or  other 
property. 

3.  Extent  of  supervision  by  landlord. 

4.  Extent  of  landlord's  activities  in  directing  farming  operations 
or  in  disposing  of  farm  products. 


CIRCULAR   272]  CALIFORNIA   FARM    TENANCY    AND   LEASING  37 

5.  Permissible  use  by  tenant  of  pasture,  wood,  timber,  gravel,  game 
and  farm  products  for  personal  or  family  use. 

/    6.  Permissible  sale  of  manure,  gravel,  leaf  mold,  peat,  rock,  timber, 
and  wood. 

7.  Provision  for  reimbursing  tenant  in  the  event  that  the  property 
is  sold  prior  to  the  termination  of  the  lease. 

8.  Designation  of  bank  where  undivided  funds  are  to  be  deposited. 

9.  Authorization  for  use  of  undivided  funds ;  handling  receipts  and 
expenditures. 

10.  Restricting  activities  of.  tenant  to  property  covered  by  lease. 

11.  Prohibitions  regarding  renting  or  loaning  landlord's  property. 

12.  Right  of  ingress  or  egress  by  landlord  or  his  agent ;  right  to 
inspect  property. 

13.  Subletting,  or  assigning  lease  by  tenant. 

14.  Living  on  property  during  lease. 

15.  Committing  or  permitting  waste  or  damage. 

16.  Submitting  inventories  at  stated  intervals. 

17.  Changes  in  conditions  of  lease  in  the  event  of  fire,  floods,  acci- 
dents, death,  or  other  conditions  beyond  the  tenant's  control. 

18.  Protection  of  tenant  if  litigation  or  seizure  of  landlord's  title 
occurs. 

19.  Terms  governing  money  advances  by  landlord — when  and  how 
obtainable,  when  and  how  repayable,  interest  rate. 

20.  Adjusting  differences  by  arbitration  in  case  of  disputes. 

21.  Upkeep  of  buildings  and  fences ;  supplying  materials  and  labor. 

22.  Repair  of  implements  and  machinery. 

23.  Control  of  weeds,  rodents  and  other  pests  in  accordance  with 
federal,  state,  and  county  laws  and  mutual  agreement  between  parties 
to  the  lease. 

24.  Care  of  lawns,  shrubbery,  and  other  landscape  plantings. 

25.  Payment  of  taxes. 

26.  Carrying  insurance  on  growing  and  harvested  crops,  livestock, 
feed,  or  carrying  employer's  liability  insurance. 

i  27.  Purchase  and  maintenance  of  water  stock. 

28.  Payment  of  fuel,  power  and  water  bills. 

29.  Erection  of  temporary  or  permanent  irrigation  structures. 

30.  Liability  for  damages  resulting  from  flooding  neighboring  lands 
or  public  roads. 

31.  Sales  of  products  through  specified  agency. 

32.  Delivering  of  landlord's  share  to  designated  place. 

33.  Reservation  of  ditch  and  drainage  rights  of  way. 

34.  Keeping  premises  and  buildings  clean,  sanitary,  and  in  repair. 


38  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

35.  Keeping  account  of  receipts,  expenditures,  and  inventory 
changes. 

36.  Provision  in  event  of  death  of  one  or  all  of  the  lessees  when 
two  or  more  tenants  are  involved  in  the  contract. 

37.  Keeping  livestock  confined  or  under  fence. 

38.  Erection  of  new  farm  buildings  and  fences. 

39.  No  alterations  or  improvements  of  structures  to  be  made  with- 
out landlord 's  permission. 

40.  Reserving,  maintaining,  and  protecting  rights  of  way  and 
ranch  roads;  restrictions  as  to  the  opening  of  new  roads. 

41.  Precautions  to  be  taken  against  fire  by  having  harvesters  equip- 
ped with  good  smoke  screens,  grass  cleared  away  for  stated  distance 
from  buildings,  fire  lanes  plowed  around  fields  and  pastures,  sacks  and 
water  kept  handy  during  dry  season,  and  men  trained  in  the  use  of  fire 
extinguishers. 

42.  Care  of  work  stock,  including  the  hiring  of  competent  help, 
particularly  drivers,  milkers,  and  herders. 

43.  Provisions  for  the  raising  of  feed  for,  and  the  keeping  of  any 
animal  strictly  for  the  benefit  of  the  tenant,  e.g.,  family  cow,  horse, 
goats,  or  chickens ;  raising  of  vegetables  for  tenant 's  use. 

44.  Privilege  of  landlord  hiring  work  done  if  tenant  fails  to  con- 
form to  requirements  of  lease  and  deducting  the  cost  from  receipts 
before  turning  tenant 's  share  over  to  him. 

45.  Keeping  articles  deemed  extra  hazardous  by  insurance  com- 
panies which  may  increase  rate  of  fire  insurance;  premises  not  to  be 
used  in  violation  of  any  law,  ordinance,  or  regulation. 

46.  Preparing  farm  products  for  sale,  as  clearing,  treating,  baling, 
boxing,  etc. 

47.  Reimbursing  tenant  for  unexhausted  fertilizers  applied  by  him, 
and  for  improvements  made  by  him. 

SPECIAL  PROVISIONS  FOE  FIELD  CROP  LEASES 

In  making  up  leases  of  lands  to  be  utilized  for  the  production  of 
field  crops  certain  special  items  should  be  considered.     These  are : 

1.  Depth,  number,  and  time  of  plo wings,  together  with  other  land 
preparation. 

2.  Time  and  manner  of  seeding. 

3.  Variety,  quality,  amount,  and  preparation  of  seed. 

4.  Extent,  kind,  and  time  of  crop  cultivation  to  be  given. 

5.  Time  and  method  of  harvesting. 

6.  Plowing  of  fire  lanes  to  keep  down  fire  hazard. 


Circular  272J  California  farm  tenancy  and  leasing  39 

7.  Insuring  crops  while  growing,  during  harvest,  and  after  ware- 
housing. 

8.  Reservation  or  utilization  of  crop  by-products,  as  straw  and 
stubble,  and  regulation  of  pasturing. 

9.  Kind  and  number  of  livestock  to  be  kept. 

10.  Pasturing  when  land  is  wet. 

11.  Payment  of  tenant,  in  event  of  terminating  lease,  for  labor 
expended  for  plowing  and  cultivating  land  to  be  cropped,  or  for 
summer  fallow. 

12.  Method  of  determining  share  of  each,  as  field  piling  in  proper 
proportion. 

13.  Removal  of  crop  residues,  as  sorghum  stubble,  and  cotton 
stalks. 

14.  Burning  stubble  or  refuse. 

SPECIAL  PROVISIONS  FOR  FRUIT  LEASES 

Items  which  should  be  weighed  in  making  up  leases  that  are  to 
convey  orchard  and  vineyard  properties  are : 

1.  Depth,  kind,  number,  and  time  of  cultivations;  subsoiling. 

2.  Time  and  number  of  applications  and  amount  of  irrigation 
water  to  be  used. 

3.  Method  and  time  of  pruning;  disposal  of  prunings;  protection 
of  large  wounds. 

4.  Hand  thinning  of  fruit. 

5.  Grafting  to  other  varieties. 

6.  Intercropping — extent,  permissible  crops,  and  proximity  to 
trees. 

7.  Green  manuring  or  cover  cropping ;  method  of  growing  or 
turning  under. 

8.  Fertilizing. 

9.  Propping  and  bracing  of  trees;  when  and  how. 

10.  Pest  control,  as  spraying,  killing  rabbits  and  rodents,  weed 
control,  cutting  into  diseased  tissue,  sulfuring,  and  fumigating. 

11.  Whitewashing  of  trees. 

12.  Replacement  of  dying  trees. 

13.  Responsibility  for  determining  how  products  are  to  be  handled 
if  there  is  a  choice,  e.g.,  dried,  shipped  to  retail  markets  or  to  can- 
neries, or  otherwise  disposed  of. 

14.  Selection  of  selling  agency,  market,  and  method  of  transpor- 
tation. 

15.  Protection  of  orchard  brands,  trade-marks,  or  labels. 


40  UNIVERSITY    OF    CALIFORNIA— EXPERIMENT    STATION 


SPECIAL  PROVISIONS  FOR  DAIRY  LEASES 

Dairy  leases,  in  common  with  all  livestock  leases,  should  take  into 
account  the  proper  handling  of  the  animals  in  addition  to  the  care  of 
the  land  and  its  appurtenances.  Special  items  to  be  considered  in 
framing"  a  dairy  lease  are : 

1.  Replacement  of  or  payment  by  tenant  for  cows  or  bulls  dying 
because  of  neglect. 

2.  Employment  of  competent  veterinarian  in  event  of  occurrence 
of  disease  or  accident  to  cows  or  horses. 

3.  Ownership  of  hogs. 

4.  Payment  for  new  alfalfa  plantings. 

5.  Membership  in  cow-testing  association. 

6.  Keeping  pure-bred  bulls. 

7.  Whitewashing  dairy  buildings,  both  inside  and  outside. 

8.  Removal  of  cobwebs,  dust,  and  mud  from  buildings. 

9.  Keeping  manure  removed  from  inside  and  outside  of  dairy 
buildings. 

10.  Removal  of  manure,  dust,  and  mud  from  corrals. 

11.  Preservation  and  disposal  of  manure. 

12.  Screening  of  windows  and  doors  by  landlord. 

13.  Reporting  by  tenant  to  landlord  any  cow  showing  signs  of 
tuberculosis,  abortion,  or  any  disease  or  injury,  or  falling  off  in  milk 
production. 

14.  Reporting  by  tenant  to  landlord  of  any  hogs  showing  signs 
of  disease. 

15.  Keeping  cows  in  separate  strings  and  in  regular  order  to  insure 
regular  milking. 

16.  Milking  and  feeding  to  be  done  at  regular  and  uniform  times. 

17.  Bringing  in  cows  and  heifers  for  proper  care  prior  to  calving. 

18.  Heifer  calves  selected  for  raising  to  be  removed  from  cows 
after  first  few  days  and  then  fed  milk  properly  pasteurized. 

19.  Keeping  watering  troughs,  feed  troughs,  and  mangers  scrupul- 
ously clean. 

20.  Provision  for  dividing  increase  in  young  stock;  selection  of 
heifers  to  be  raised. 

21.  Ample  feeding  to  be  practiced  on 'Basis  of  clean  and  wholesome 
ration. 

22.  Keeping  dry  stock  and  young  stock  in  good  condition. 

23.  Fences  to  be  maintained  so  that  all  animals  can  be  kept  under 
control. 


Circular  272]  CALIFORNIA  FARM   TENANCY    ami   LEASING  41 

24.  Keeping  breeding  record:  Bulls  to  be  kept  separate  from  herd. 

25.  Pasturing  of  alfalfa  when  ground  is  wet. 

26.  Method  of  branding  or  marking  increase 

27.  Compliance  with  state  or  county  regulations  governing  eondud 
of  dairies. 

28.  Ringing  of  hogs. 

29.  Overcrowding  of  land  during  last  year  of  lease 

30.  Reseeding  of  thin  stands  of  alfalfa;  renovation  of  alfalfa. 

31.  Care  of  milk  house  equipment. 

32.  Care  of  empty  silos. 

33.  Regular  sterilization  of  milk  utensils  and  cooling  of  milk. 

34.  Disposition    of    reactors   to    tuberculin    test;    maintenance    of 
tuberculosis-free  dairv. 


SPECIAL  PROVISIONS  FOR  LEASES  OF  LIVESTOCK  RANGES 

In  addition  to  a  consideration  o£  the  general  provisions  discussed 
above  there  are  certain  special  items  which  should  be  weighed  when 
drawing  up  leases  of  livestock  ranges.     The  following  arc1  indicative: 

1.  Kind  of  livestock  to  be  kept. 

2.  Amount  of  stock  permitted. 

3.  Amount  of  outside  livestock,  other  than  tenant's,  permitted. 

4.  Maintainance  of  fences — boundary,  cross,  and  corral. 

5.  Maintainance  of  stock  watering  equipment,  tanks,  windmills, 
engines,  troughs,  pipe  lines. 

6.  Keeping  water  holes  open. 

7.  Killing  squirrels,  coyotes,  and  other  pests. 

8.  Keeping  off  livestock  known  to  be  diseased. 

9.  Segregating  of  livestock  showing  symptoms  of  diseases,  prevent- 
ing so  far  as  is  possible  contamination  of  range  and  corrals. 

10.  Keeping  gates  closed. 

11.  Details  of  feeding,  whether  feed  is  to  be  sold  (e.g.,  any  hay  put 
up),  and  method  of  feeding  on  range. 

12.  Reseeding  of  range. 

13.  Bringing  weedy  hay  on  place. 

14.  If  landlord  furnishes  livestock,  details  of  handling,  such  as 
branding,  altering,  breeding,  feeding,  and  selling. 

15.  Replacement  of  stock  lost  by  reason  of  disease,  accident  or 
aging. 

16.  Care  of  sires,  of  saddle  horses,  and  of  equipment. 

17.  Registering  of  brands. 

18.  Disposal  of  dead  animals. 


42  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 


SAMPLE   LEASE  FORM 

So  much  variation  occurs  in  California  agriculture  that  no  single 
lease  form  is  applicable  to  all  conditions.  Differences  are  so  widely 
encountered  in  quality  of  demised  properties,  in  personal  traits  of 
contracting  parties,  and  in  aims  and  ideals  of  the  landlords  and 
tenants  that  any  set  form  is  valuable  chiefly  in  its  suggestive  capacity 
rather  than  as  an  all-inclusive,  ever-applicable  document. 

Because  of  the  steady  demand  for  something  of  a  definite  form  a 
sample  lease  is  here  inserted.  It  provides  a  skeleton  outline  in  which 
all  agreed  details  can  be  inserted. 

1.  This  agreement,  made  and  entered  into  this day  of 

19 ,  by  and  between ..... 

party  of  the  first  part,  of  the  town  of ,  county  of , 

State  of  California,  and -. ,  party  of  the  second  part,  of 

the  town  of ,  County  of ,  State 

of 

2.  Witnesseth: 

That  for  and  in  consideration  of  the  mutual  covenants  and  agreements  of 
the  parties  hereto,  as  hereinafter  set  forth,  the  party  of  the  first  part  does 
hereby  lease,  let  and  demise  unto  the  party  of  the  second  part,  and  the  party 
of  the  second  part  does  hereby  lease  and  accept  from  said  party  of  the  first 
part,  all  that  certain  real  property  lying  and  being  situate  in  the  county  of 

,  State  of  California,  particularly  known,  designated,  and 

described  as  follows  to-wit: 

3.  (Insert  description  of  property.) 

4.  To  have  and  to  hold  the  same  for  a  term  of years,  from 

(beginning  date)  to 

(ending  date)  inclusive  for  the  purpose  of: 


5.  (Insert  here  statement  of  crops  to  be  grown  or  enterprises  to  be  con- 
ducted, as  for  instance,  conducting  a  dairy  thereon;  plowing,  cultivating,  and 
otherwise  taking  care  of  the  orchard  thereon  including  harvesting  and  selling 
of  crops;  raising  a  crop  of  barley  for  either  grain  or  hay  as  the  season  may 
determine.) 

6.  Section  I.  The  party  of  the  first  part  is  to  furnish  to  the  party  of  the 
second  part  the  above  described  farm  and  premises  in  good  and  sufficient  con- 
dition to  permit  the  carrying  on  of  the  business  for  which  it  is  leased,  and  also 
(insert  additional  equipment,  livestock,  or  property  to  be  supplied  by  party 
of  the  first  part). 


CIRCULAR  272]  CALIFORNIA   FARM   TENANCY   AND   LEASING  43 

7.  Sec.  II.  The  party  of  the  second  part  is  to  furnish  (list  all  items  of 
equipment  to  be  furnished  by  the  party  of  the  second  part). 

8.  Sec.  III.  The  party  of  the  first  part  agrees  to  (insert  here  all  items  that 
the  party  of  the  first  part  agrees  to  do,  such  as  bearing  a  share  of  operating 
expenses,  assuming  responsibility  of  selling  products,  insuring  peaceable  posses- 
sion and  other  items,  suggestions  for  which  can  be  found  in  the  list  given  above 
of  provisions  entering  into  the  construction  of  farm  leases.) 

9.  Sec.  IV.  The  party  of  the  second  part  agrees  to  (insert  here  full  statement 
of  what  tenant  is  to  do)  such  as: 

To  occupy  the  farm  continuously  throughout  the  lease  period. 

Not  to  attempt  to  operate  outside  land  in  addition;  not  to  thresh  for  out- 
siders; not  to  give  preference  to  any  other  work  over  the  operation  of  the 
farm. 

Not  to  rent  out  workstock,  implements,  or  other  equipment  owned  by  the 
landlord. 

The  party  of  the  second  part,  the  tenant,  agrees  that  he  will  not  commit  or 
suffer  to  be  committed  any  waste,  damage,  or  strip  of  said  premises,  such,  for 
instance  as  cutting  fence  wires,  removing  sections  of  fence,  failing  to  oil  pumps 
and  windmills,  or  tearing  down  fences  for  purposes  not  required  in  the  ordinary 
course  of  farming. 

The  party  of  the  second  part  agrees  to  keep  the  buildings,  fences,  and 
other  improvements  on  said  premises  in  as  good  repair  and  condition  as  they 
are  when  he  takes  possession,  or  as  good  as  they  may  be  put  in  by  the  lessor 
during  the  term  of  the  lease,  ordinary  wear,  loss  by  fire,  or  unavoidable  destruction 
excepted. 

10.  Sec.  V.  It  is  understood  and  mutually  agreed  that  the  property  is  to  be 
leased  for (cash  or  share)  under  the  following  conditions: 

(Insert  here  all  matter  pertaining  to  amount  of  rent,  method  and  time  of 
payment,  and  protection  and  determination  of  landlord's  share  when  the  share 
method  is  used.) 

11.  Sec.  VI.  It  is  understood  and  mutually  agreed  that: 

In  the  event  that  the  tenant  shall  fail  in  any  manner  to  keep  and  perform 
any  of  the  terms,  covenants,  or  provisions  of  this  lease,  the  lessor  may  imme- 
diately enter  upon  said  real  property  and  take  possession  thereof  and  of  all 
property  jointly  owned,  care  for  same  and  charge  the  expense  to  the  tenant 
until  settlement  can  be  made,  which  action  shall  be  taken  as  nearly  as  possible 
according  to  the  terms  of  this  lease. 

In  the  event  of  the  death  of  the  tenant,  during  said  tenant's  rightful  enjoy- 
ment of  this  lease,  said  lease  and  all  rights  thereunder  shall  immediately  cease 
and  terminate  and  the  lessor  may  immediately  enter  and  take  possession  of  said 
real  property  and  any  and  all  personal  property  situated  thereon,  including  any 
products  thereof,  and  care  for  same  until  settlement  can  be  made,  which  action 
shall  be  taken  as  nearly  as  possible  according  to  the  terms  of  this  lease. 

In  the  event  of  the  death  of  the  lessor,  said  lease  shall  be  incumbent  upon 
the  administrators  of  the  estate  of  said  lessor. 

If  dispute  shall  arise  over  any  of  the  settlements  provided  for  in  this  lease 
the  matter  shall  be  left  to  a  board  of  three  arbiters,  one  chosen  by  the  lessor, 
another  by  the  tenant,  and  the  third  by  the  two  first  chosen  and  the  decision 
of  this  board  shall  be  binding  on  both  lessor  and  tenant  (state  who  shall  pay 
arbiters). 


44  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

Said  parties  to  this  lease  shall  be  in  no  sense  partners.  Neither  shall  bind 
the  other  to  any  obligations  nor  incur  debts  for  the  payment  of  which  the  other 
party  might  be  liable  without  the  written  consent  of  that  party. 

Said  lessor  hereby  reserves  the  right  of  entrance  upon  said  premises  at  all 
reasonable  hours  in  order  to  make  inspections  and  to  make  improvements  as  he 
shall  deem  expedient. 

Said  tenant  agrees  not  to  sublet  nor  assign  this  lease,  by  power  of  attorney 
or  otherwise,  without  the  written  consent  of  the  lessor,  and  this  provision  shall 
apply  as  well  to  any  involuntary  assignment,  and  it  is  understood  and  agreed 
in  that  connection  that,  should  the  lessee  become  bankrupt,  this  lease  shall 
immediately  terminate  and  end  at  the  option  of  the  lessor,  and  this  agreement 
shall  not  pass  into  the  hands  of  any  trustee  in  bankruptcy  or  assignee  for  the 
benefit  of  the  creditors  of  said  tenant. 

At  the  expiration  of  the  term  of  this  lease,  the  tenant  agrees  that  he  will 
quit  and  surrender  said  premises  in  as  good  state  and  condition  as  reasonable 
wear  and  use  thereof  will  permit.  Should  tenant  hold  over  the  term  herein 
created,  such  tenancy  shall  be  from  month  to  month  only,  and  be  on  the  same 
terms  and  conditions  as  herein  stated. 

In  case  of  sale  of  said  premises  during  the  tenancy  of  said  second  party, 
and  in  case  the  purchaser  should  desire  possession,  said  second  party  hereby 
agrees  to  give  to  the  said  purchaser  said  premises'  at  once  on  payment  to  the 
said  second  party  of  a  fair  and  reasonable  compensation  for  such  surrender. 
(State  method  of  determining  amount  and  terms  of  payment.) 

At  the  expiration  of  this  lease,  by  limitation  or  otherwise,  the  second  party 
will  yield  possession  of  said  premises  in  as  good  condition  as  they  were  at  the 
beginning  of  this  lease,  natural  wear  and  damage  excepted,  expressly  waiving 
any  and  all  notice  to  terminate,  except  as  herein  specifically  provided. 

12.  Sec.  VII.     (Insert  here  any  items  not  provided  for  above.) 

13.  In  witness  ivhereof,  the  parties  hereto  have  hereunto  set  their  hand's  and 
seals  this  day  and  year  first  above  written. 

: (Date)    - 

(Place)  


Party  of  the  First  Part. 
Partv  of  the  Second  Part. 


Witness 
Witness 

EMPIRICAL  METHOD  FOR  DETERMINING  RENTAL  RATES 

The  empirical  method  is  an  aid  in  determining  the  pro  rata  of 
income  that  tenant  and  landlord  are  entitled  to.  This  method  takes 
into  account  the  various  items  of  investment  and  operating"  expenses 
furnished  by  each  party  to  the  lease,  and  allows  sums  to  cover  interest, 
depreciation,  and  reimbursement  for  moneys  spent  for  labor,  seed, 
supplies,  and  similar  items. 


Circular  272]  CALIFORNIA  FARM   TENANCY    and   LEASING  4.") 

The  first  step  is  to  make  two  lists,  one  showing  what  the  owner  is 

to  furnish,  the  other,  what  the  tenant  is  to  supply.  These  Lists  should 
cover  all  items — investment,  operating  and  overhead,  with  values 
affixed.    The  following  lists  are  suggestive : 

Investment  Items: 

Land  (use  productive,  value,  or  usual  rental  rate  in  community  if  this  is 
more  desirable) acres  at  $ 

Buildings  and  structures  (to  cover  dwellings,  bunkhouses,  barns,  water  tanks 
and  towers,  poultry  houses,  hog  houses,  milking  barns,  implements,  sheds,  etc.). 

Work  stock 

Livestock  Operating  Items: 

Dairy  cows 

Brood  sows  Labor  (both  ,lin,<l  0T  s,1!ll»li,'|l  '"  person) 

Feed 
Seed 


Breeding  sheep 
Beef  cattle 


Implements  and  machinery        Supplies 


Special  equipment 
Dairy  house 
Farrowing  sheds 
Veterinary  supplies 


Repairs,  parts  and  shop  material 

Taxes 

Insurance 

Veterinary  supplies 


Fruit  trays  and  boxes  Commissary  supplies 


Office  supplies  (telephone,  stamps,  stationery) 

Fuel 

Gasoline,  oil,  distillate 


Overhead  Items, 


Grain  cleaning  machinery 
Shop  equipment 

Blacksmith 

Carpenter 
Bunkhouse  furnishings 
Kitchen  (for  hired  men)  Management 

Office  equipment  Sinking  fund 

Pumping  plants  Depreciation 

Since  neither  capital  nor  labor  can  produce  profits  without  guid- 
ance and  direction,  a  charge  for  management  is  a  just  one.  A  workable 
and  usually  satisfactory  determination  of  what  to  charge  can  be 
obtained  by  using  the  prevailing  salaries  paid  for  similar  duties,  when1 
the  supervision  isdiired  done,  and  where  the  superintendent  or  manager 
does  no  manual  work.  The  business  should  then  bear  its  pro  rata 
based  on  its  size  as  compared  with  the  usual  size  handled  by  paid  men. 
For  example,  if  the  going  wage  is  $250  cash  and  $50  perquisites  per 
month  for  superintending  on  diversified  farms  averaging  640  acres, 
then  the  annual  acreage  charge  amounts  to  approximately  $5.50.  An 
80-acre  place  may  justly  be  called  upon  to  meet  its  proper  pro  rata. 
in  this  case,  $440,  for  management. 

The  sinking  fund  is  a  sum  set  aside  during  prosperous  years  to 
tide  the  business  over  dull  times  of  crop  failure,  accident,  disease, 
and   market   slumps,    and    is   obtained    by    dividing    the    actual    sum 


46  UNIVERSITY    OF    CALIFORNIA — EXPERIMENT    STATION 

required  during  the  off  year  by  the  number  of  prosperous  years  which 
can  contribute.  For  example,  if  in  a  given  deciduous  fruit  district  a 
partial  crop  failure  occurs  about  once  in  five  years  and  the  average 
farm  needs  $2000  to  carry  about  over  the  lull,  the  $2000  represents 
the  necessary  sinking  fund  and  is  made  up  by  charging  the  business 
with  $500  per  year  for  each  of  the  four  prosperous  years. 

Depreciation  covers  the  wear  and  tear  of  implements  and  machin- 
ery, the  decay  of  buildings  and  fences,  and  the  ageing  of  work  horses 
and  other  livestock;  in  other  words,  it  is  that  sum  which  should  be 
regularly  set  aside  to  maintain  original  values  of  the  business  which 
are  subject  to  shrinking,  and  the  neglect  of  which  would  eventually 
mean  the  running  down  of  the  business  to  a  point  where  new  invest- 
ment of  capital  must  be  made. 

Once  the  lists  of  what  each  party  is  to  furnish  are  completed,  the 
second  step  consists  in  determining  what  each  is  entitled  to.  In 
general,  these  items  consist  of: 

(1)  Interest  at  the  going  rate  on  all  moneys  invested,  both  for 
investment  items  or  set  aside  to  meet  operating  expenses. 

(2)  A  sum  to  cover  depreciation.  This  is  determined  by  dividing 
the  original  cost  by  the  probable  life  of  the  item. 

(If,  as  in  the  case  of  certain  livestock,  there  is  a  final  meat  value, 
the  amount  of  this  value  is  deducted  from  the  maximum  value  and 
this  difference  divided  by  the  number  of  years  to  obtain  the  deprecia- 
tion figure.) 

(3)  Repayment  for  moneys  expended  for  operating  expenses,  such 
as  labor,  feed,  seed,  marketing  costs,  taxes,  and  insurance. 

(4)  Payment  for  labor  furnished  by  tenant. 

(5)  Payment  of  a  sum  for  management  work. 

(6)  Sum  to  cover  sinking  fund. 

The  sum  is  to  be  determined  separately  for  both  tenant  and  owner. 
The  relation  of  the  sum  of  each  to  the  total  gives  the  proportion  that 
each  is  entitled  to.  An  example  will  illustrate  the  application  of  this 
method. 

Assume  available  a  40-acre  farm  having  a  10-cow  dairy,  10  brood 
sows,  35  acres  of  alfalfa,  and  full  equipment  to  carry  on  the  business. 
The  farm  is  to  be  leased  under  terms  as  follows : 

The  owner  agrees  to  furnish  forty  acres  of  land  worth  $9020, 
buildings  ($1270),  fences  ($347),  35  acres  of  good  alfalfa,  10  cows', 
1  bull,  10  brood  sows,  1  boar,  $530  worth  of  farm  implements,  and 
$328  of  miscellaneous  equipment  necessary  to  the  carrying  on  of  the 
business. 


CIRCULAR   272]               CALIFORNIA   FARM   TENANCY   AND   LEASING  47 

The  tenant  to  supply  work  stock,  labor,  all  purchased  feed,  seed, 
and  operating  expenses. 

Owner  will  pay  taxes  ($125)  and  insurance  ($15). 
Proper  division  of  income  is  sought. 

Items  Involved: 
Prom  Owner — 

Land — 35  acres  good  alfalfa;  5  acres  farmstead $9,020.00 

Buildings  1,270.00 

Fences    347.00 

Cows  (10)   850.00 

Bull  100.00 

Sows  (10)   200.00 

Boar   ! 30.00 

Implements  530.00 

Miscellaneous  equipment  328.00 

Taxes    125.00 

Insurance  15.00 

From  Tenant — 

Work  stock  300.00 

Labor  108.00 

Feed— horses  12.00 

Dairy    180.00 

Hogs  474.00 

Seed    21.00 

Water  80.00 

Other  material  10.00 

Rent,  silo  cutter 6.00 

Contract  work 142.00 

Management  720.00 

Office  expenses  50.00 

Incidentals    50.00 

Assuming  that  these  figures  are  satisfactory  and  that  each  party  is  entitled 
to  (a)  return  of  money  spent  outright,  (&)  six  per  cent  interest  on  investment, 
and  (c)  depreciation,  we  should  have: 

For  Owner — 

Outlay — taxes  and  insurance $140.00 

Interest  on  investment — $12,675  at  six  per  cent 760.50 

Depreciation: 

5  per  cent  on  buildings  and  fences  ..... 80.85 

6  per  cent  on  cows  and  bulls  57.00 

17  per  cent  on  sows    and    boar    39.10 

10  per  cent  on  implements    53.00 

25  per  cent  on  $116  special  equipment  29.00 

10  per  cent  on  $105  special  equipment  10.50 

10  per  cent  on  $109   tools   10.90 

Total  interest  of  owner  in  output $1,180.85 


48  UNIVERSITY    OF    CALIFORNIA EXPERIMENT    STATION 

For  Tenant — 
Outlay: 

Labor    _ _ $108.00 

Feed   .. : G66.00 

Seed    21.00 

Water 80.00 

Materials  10.00 

Rent,  silo  cutter 6.00 

Contract  work   142.00 

Tenant's  time  r. 720.00 

Office  expenses 50.00 

Incidentals 50.00 

$1,853.00 
Interest  on  investment — $1,000  (estimated)  operating  capital  at 

four  per  cent  .. '. $40.00 

6  per  cent  on  horses — $300  18.00 

Depreciation  of  horses  at  12  per  cent  36.00 

Total  interest  of  tenant  in  output  $1,947.00 

Combined    interest $3,127.85 

Percentage  interest  of  each  in  income — 

Owner,  38  per  cent. 

Tenant,  62  per  cent. 

CONCLUSION 

.  A  state-wide  policy  looking  to  permanency  in  California  agricul- 
ture requires  that  the  place  of  tenancy  be  more  accurately  measured 
in  the  future  than  it  has  in  the  immediate  past,  that  conditions  be 
improved  for  deserving  tenants  so  that  men  may  be  drawn  to  the 
land  who  shall  become  social  as  well  as  economic  assets,  and,  finally, 
that  the  land  and  all  that  it  implies  shall  be  given  that  consideration 
which  will  protect  it  from  ruinous  practices  and  short-sighted  exploita- 
tion. Upon  the  welfare  of  its  agriculture  does  much  of  California's 
prosperity  depend. 

ACKNOWLEDGMENTS 

Credit  is  due  to  a  number  of  persons  who  have  rendered  assistance 
in  collecting  material  or  in  reviewing  findings  and  text.  Messrs. 
S.  Anderson,  W.  W.  Bedford,  W.  N.  Brown,  N.  D.  Hudson,  E.  S. 
Lindauer,  and  W.  P.  Wing  aided  substantially  in  collecting  and 
assembling  field  data,  The  portion  dealing  with  general  and  special 
provisions  to  be  considered  when  drawing  up  a  lease  was  reviewed  and 
strengthened  by  Professors  G.  H.  Hart,  G.  W.  Hendry,  W.  W.  Mackie, 
B.  A.  Maclson,  R.  F.  Miller,  C.  L.  Roadhouse,  W.  P.  Tufts,  and  Mr. 
A.  E.  de  Fremery  of  the  College  of  Agriculture. 


